Baroness Ashton of Upholland: My Lords, I have read with great interest the contributions of the noble Lord, Lord Northbourne in the debates, and I know he is concerned that the purpose of all this should be that we have reform of offenders and that recidivism rates drop substantially. I completely support him on that. We are seeking to develop a relationship with the offender manager that takes offenders through their sentences and beyond, to the point where the support and advice they get achieves that objective. As noble Lords will know, in the Offender Management Bill we are bringing in other organisations to enable us to work together in real partnership. I pay tribute to the many organisations that do sterling work in supporting those with drug or alcohol problems and to those who can offer training and work opportunities.

Baroness Howe of Idlicote: My Lords, in the rollout of offender management, are the Government giving specific attention to the recommendations of the Corston report on the needs of women offenders with regard to smaller, locally-based units so that families can stay together and be less damaged and rehabilitation becomes more likely?

Lord Lloyd of Berwick: My Lords, given the criticism of the Lord Chief Justice in his recent letter of12 April, do the Government now regret the use of the term "seamless management of offenders through the courts" by the new Ministry of Justice? Is there not now a clear case for an inquiry, as called for by the Lord Chief Justice in his recent evidence to the Constitutional Affairs Committee of the House of Commons, before relationships between the Government and the judiciary deteriorate still further?

Lord Howell of Guildford: My Lords, the noble Baroness, Lady Cox, is right to keep bringing this issue before us. Are there not 7 million Karen people in Burma, and another 400,000 in Thailand, and have they not been subjected steadily to the most appalling atrocities, being rounded up, shot down and slaughtered in manners reminiscent of the Nazi era? Are not40 per cent of them Christians? Are they not a people to whom we in Britain owe a considerable debt, since they supported us against our enemies during the Second World War? Will the Minister assure us that their plight and our efforts to carry on with the initiatives that he described are continually to the forefront in his department and in government policy? We need to maintain our reputation for looking after our friends in the world—a reputation that is unfortunately in tatters in other parts of the world at the moment.

Lord Triesman: My Lords, the Minister of State for Climate Change and the Environment and I have already condemned publicly the decision to appoint Zimbabwe asthe chair of the UN Commission on Sustainable Development. The United Kingdom, with 20 other EU and like-minded states that are members of the commission, voted against Francis Nhema's candidacy. On behalf of all EU member states, including the United Kingdom, the EU presidency then made a statement expressing deep concern that a representative from Zimbabwe should become chair. It will undoubtedly damage the commission's work and credibility.

Lord Rooker: My Lords, I am sorry, but we have run into the24th minute. We must allow time for the final Question.

Lord Ahmed: My Lords, I thank my noble friend for his Answer. Is he aware of the Amnesty International report on the widespread disappearance of Pakistani citizens and British nationals? There were over200 cases in front of the Supreme Court of Pakistan, and the chief justice of the Supreme Court was suspended soon after. Will Her Majesty's Government make the strongest representations to the Government of Pakistan about British citizens being held in custody, in relation to human rights, the rule of law and democracy in Pakistan?

Lord Triesman: My Lords, I would have chosen the word "co-operate" as well. This is an area in which mutually supportive work is most likely to succeed. It is quite right to place it in the context of saying that our mutual work, particularly on counter-terrorism, is of vital interest to both countries. If we were to lose sight of that, I fear that we would place our own people in very much greater danger.

Lord Grocott: My Lords, with permission, a Statement on Waste Strategy will be repeated by my noble friend the Deputy Leader immediately after the first debate.

Baroness Amos: My Lords, I informed the House on 20 March ofMr Paul Hayter's intention to retire from the office of Clerk of the Parliaments, with effect from Saturday3 November. I told the House on that occasion that it had been agreed that a trawl for Mr Hayter's successor should be held, with applications being invited from the House of Commons and the devolved assemblies, as well as from the House of Lords. There were four applicants, all of whom were interviewed by a board consisting of myself, the other party leaders, the Convenor of the Cross-Bench Peers, the Lord Speaker andJanet Paraskeva, the First Civil Service Commissioner. The unanimous recommendation of the board is that Mr Michael Pownall should succeed Mr Paul Hayter as Clerk of the Parliaments.

Lord Howe of Aberavon: rose to call attention to the conduct of the machinery of government and to the role of an independent Civil Service and judiciary; and to move for Papers.
	My Lords, I confess that I cannot resist the temptation to begin by quoting an article that appeared last Friday in the Financial Times by one of its most distinguished correspondents, Martin Wolf. He stated:
	"Good government ... is a government of laws—not of men—and of orderly procedure—not of whim".
	It has respect for institutions which,
	"embody continuity, ensure predictability and preserve wisdom".
	He said that good government is ready to modify institutions where necessary, and he rightly cites the granting of independence to the Bank of England as "a superb example" of that. Alas, that was an exception and certainly not the prevailing rule. On the contrary, Martin Wolf said:
	"Look at the mountains of half-baked initiatives, the manic news management, the higgledy-piggledy constitutional reforms, the frantic propensity to legislate, the hostility to legal restraints, the indifference to the past and the preference for courtiers over permanent officials".
	Recycling that all-too-accurate indictment gives me not one ounce of pleasure. On the contrary, it makes me all the more anxious that we learn the lessons that might prevent such behaviour happening in the future: lessons that need to learnt by those who will have the responsibility of leading this country—my right honourable friend David Cameron and certainly the Prime Minister-designate who will soon loom over us.
	These lessons are constantly being illustrated in your Lordships' House, where we witness our hapless ministerial colleagues struggling day after day to defend the indefensible. There are endless examples of failure or mismanagement and of over-complex, ill-thought-out, often high-tech, schemes. For example, on tax credits, 10 years after their introduction by the Chancellor, a PAC report said only a few weeks ago that,
	"the Department has still not developed an adequate response to the unacceptable levels of error and fraud".
	That black mark on the Chancellor's own territory almost cancels out the brownie point that I gave him a moment ago.
	The noble Baroness, Lady Scotland, this week had to acknowledge that the costs of ID cards had risen by some £800 million in the past six months. The noble Baroness, Lady Andrews, had to acknowledge that home information packs were going back not just to the drawing board, but into the bin—where they should be. On the Rural Payments Agency, the noble Lord, Lord Rooker, is hauled over the coals almost once or twice a week—and so on. Other examples are the National Health Service computer programme and Modernisation of Medical Careers, which has ended up with 34,000 doctors left in the wilderness.
	In every other field, similar signals of uninterrupted upheaval are constantly given. More and more people are echoing my six-word manifesto: "For God's sake, leave us alone!". The volume of legislation—primary and statutory instruments—which in the early 1980s was running at less than 8,000 pages a year and was much too much, in the early years of this decade has been running at 12,000 pages a year, which is much, much, much too much. We owe a debt of gratitude to the absentee noble Lord, Lord Phillips of Sudbury, for the information that he vouchsafed on 23 May 2005, when he told the House that,
	"we legislate at about two-and-a-half times the rate of Germany, three times the rate of Switzerland and five times the rate of Sweden".—[Official Report, 23/5/05; col. 324.]
	To what benefit and what purpose?
	It is not just the sheer volume of legislation that is important but the content and quality as well. It is insufficiently considered in advance by independent civil servants and still less, no doubt, by Ministers in Cabinet or elsewhere. Indeed, all too often, the policy, as well as the advice and drafting, has been contracted out. That became clear this week when, for example, the noble Lord, Lord Davies, defended, not for the first time, the performance of the Casino Advisory Panel—a sub-contractor of sub-contracting—which is now dominating the decisions.
	More remarkable perhaps are the matters that should have remained within the control of Parliament. Electoral law and procedure—previously handled by Speaker's Conferences, the last of which took place in 1978—have been contracted out to the Electoral Commission and the reduced performance of our electoral system has been condemned as being close to that of a banana republic. The chairman of that commission, Mr Sam Younger, had a distinguished record, having run the BBC World Service. The tragedy is that he was not in that immediately qualified to take on the task which he now has the burden of bearing.
	All this is only one manifestation of the way in which the formation and implementation of policy and the formulation and enforcement of law have all too often been taken away from professional, independent civil servants, and even from scrutiny and discussion by elected politicians and Ministers. If they have not been taken away, they seem not to give them as much attention as they should.
	One other example of curtailing the role of the Civil Service in this way is the frequent devolution of the analysis and preparation of policy to "courtiers", as Martin Wolf describes them, or "celebrity reviews", as they were described by the noble Lord, Lord Turnbull, in his Financial Times interview on 20 March. One courtier among our number—I do not think that he is here today; I met him only yesterday so I might be doing him an injustice—is the noble Lord, Lord Carter of Coles. He has been on and off our radar screens for a number of years in a strange diversity of roles. He has in fact prepared no fewer than 11 substantial reports that I have discovered in the past six years for six departments. Mikhail Gorbachev would describe him as truly Stakhanovite in his endeavours. The topics range from legal aid on the one hand to pathology services on the other and from the national sport effort to public diplomacy, not to mention our friend the offender management, prisons and criminal records field, which is dominating us at present.
	I have learnt that the noble Lord, Lord Carter, started life as a close school friend of Gordon Brown's campaign manager, Jack Straw. I make no complaint about that; there is no reason why the network of Brentwood School should not flourish as much as that of Eton, not to mention my own. There is no harm in that and I make no suggestion of impropriety but I do suggest a degree of unwisdom on the part of Ministers, who are constantly entrusting people of this kind, who, however great their ability, have less day-to-day experience than independent, professional civil servants and less ability, expertise and general qualifications to do tasks that they should not really be doing.
	The noble Lord, Lord Carter, is by no means alone. When the noble Lord, Lord Turnbull, spoke about celebrity reviews, he identified a number of other names that will occur to colleagues. But he rightly described the tendency of the Chancellor of the Exchequer—as he still is—frequently to make use of such celebrity reviews, describing them as "an unworthy development", in the sense that it "belittles other Ministers" and illustrates again,
	"the more or less complete contempt",
	with which they are viewed by the Treasury. Both he and Martin Wolf—and myself, among many others—fear that this manifestly centralising tendency displayed by Her Majesty's Treasury over the past10 years certainly does not bode well for the resurrection of Cabinet government when the new tenant moves into No. 10 Downing Street next month.
	Nothing more clearly indicates the need for Cabinet government than the 2004 report of the privy counsellors under the chairmanship of the noble Lord, Lord Butler, on the Iraq war intelligence. It clearly highlighted the resources of wisdom, expertise and experience available in the independent Civil Service, not least in the Foreign and Commonwealth Office—and not to mention Cabinet Ministers themselves—which was almost systemically neglected throughout that period. The privy counsellors, in paragraphs 606-11 of their report, express,
	"concern about the informal nature of much of the Government's decision-making process"—
	so-called "sofa government". They draw attention to the fact that,
	"Excellent quality papers were written by officials, but these were not discussed in Cabinet or in Cabinet Committee",
	and express the view that that process,
	"risks reducing the scope for informed collective political judgement. Such risks are particularly significant in",
	in the field of foreign affairs.
	I am tempted at this stage to launch into a long passage about the particular folly—particularly in today's world—of neglecting the potential value and proper role of a confident, well led and properly resourced Foreign Office. However, it is only two years since I initiated a debate on that subject, so I must leave it to others who are bursting with enthusiasm to speak about it. I hope that they will speak loudly enough for the message to be heard loud and clear by the incoming tenant of No. 10.
	Finally, the judiciary's true, confident and perceived independence is, as newspaper headlines of the past two days make clear, probably of greater importance than almost anything else I have so far mentioned. We have seen it threatened by the attempted abolition, and undoubtedly serious resultant erosion, of the office and standing of their historic constitutional champion, the Lord Chancellor. Now, further dilution of that championship, as a result of the merger of what was once the Lord Chancellor's department with prisons and other divisions of the Home Office, threatens that independence in at least three ways. First, within that framework, judges will come under ever greater pressure to tailor their sentences to the availability of prison places. Secondly, there is a real risk that the Lord Chancellor, their purported champion, will himself be repeatedly subject to judicial review by the judges themselves. Finally, and most importantly, the integrity of the court's budget will be under even greater threat than it is today, competing, as it has long had to do, with the hard-pressed Legal Aid Fund and now also competing directly with the prisons and probation budget.
	Nowhere will the effect be more seriously perceived than with the new Supreme Court—still the Judicial Committee of this House, with its financing currently insulated and guaranteed by Parliament itself. That was something I learnt as Chancellor of the Exchequer. I endeavoured to impose cash limits upon the expenditure of one or other House, or both. In that I was contradicted by the noble Lord, Lord Barnett, as he now is, on the other side of the fence, saying "Hands off!". I found it useful to deploy the same argument when I subsequently became Leader of the House of Commons. Once they are finally ensconced on the other side of Parliament Square, all that protection will end, and independent financing will be at risk. I believe that the Supreme Court will be much less secure in the hands of the Executive than ever it has been in the hands of this House.
	All this is a consequence of the casual, ill considered, thought-free way in which the outgoing Prime Minister has dealt with these questions. I do not say "has addressed" because I do not believe that he ever addressed them with the consideration they deserved. I believe that they have never received consideration on the scale appropriate for today. The noble and learned Lord, Lord Falconer, who is, as ever, beaming in his friendly fashion, has been obliged to struggle almost single handed through the mess while the Prime Minister and his fellow conspirator, the right honourable John Reid, are about to quit the scene. They will be leaving behind them the near destruction of the office of Lord Chancellor, which was once the lynchpin of our constitution, and the de facto subjection of the once supreme court of Commonwealth and Empire, which commanded a worldwide reputation, to having its finances controlled by the Executive of the British Government. Until three years ago, this Government were vigorously defending that office and supreme court against critics in the Strasbourg Parliament of the Council of Europe.
	On 28 April 2003, that Council's legal affairs and human rights committee expressed the view that our then existing arrangements owed their existence to:
	"the specific conditions of the United Kingdom constitutional system, which has evolved over centuries"—
	so far, so good—
	"without the beneficial modernisation introduced by the French Revolution, the effects of which were disseminated in the rest of Europe by Enlightenment thinking and the conquests of Napoleon".
	Where Napoleon failed, the outgoing Prime Minister, Mr Blair, may yet succeed, even if post mortem. That is some legacy.

Lord Thomas of Gresford: My Lords, I am grateful to the noble and learned Lord, Lord Howe of Aberavon, for introducing this debate. He has spoken of the curtailment of the independent Civil Service and the rise of the celebrity review. To some considerable degree, he has been supported by the noble Lord, Lord Lipsey, who bemoans the loss of hard analysis and proper structured policy making. I agree with all those things.
	However, I shall focus on the independence of the judiciary. I have had the experience of submitting to the Chief Justice of a foreign jurisdiction that he should recuse himself on the grounds of bias. The Government of that territory enabled their practice to bring legal proceedings against political opponents and were without exception successful. When criticised by the Privy Council, that jurisdiction abolished appeals to the Privy Council. Today, in two other Commonwealth and common law countries, the judiciary is under pressure. One is Pakistan, as we heard at Question Time. The Chief Justice of Trinidad is also under pressure, facing impeachment charges. What have the Chief Justices done? They have delivered judgments unfavourable to the ruling Government.
	The independence of the judiciary is woven into the fabric of our free and democratic society. We believe in the rule of law. At one time, you would never have thought that the Government of this country would have sought to attack a judge's decision that they were in the process of appealing. Yet Mr Blunkett, when Home Secretary in 2003, following an adverse judgment by Mr Justice Collins, said that,
	"it was time for judges to learn their place".
	He said that Mr Justice Collins was responsible for undermining Parliament. Mr Blunkett lost his appeal.
	Mr John Reid could also not contain himself last year in the Craig Sweeney case, when he criticised a sentence of 11 years' imprisonment imposed in Cardiff, notwithstanding that that sentence was in accordance with the Government's own formula. He said that it was "unduly lenient" and that he was personally referring the case to the Attorney-General to appeal. Vera Baird, his junior Minister, said that the judge had got the statutory formula wrong. In one of his finest moments of many fine moments, the Lord Chancellor, the noble and learned Lord, Lord Falconer, weighed in and pointed out that not only had the judge properly applied the statutory formula but that he would not permit judges to be made the whipping boys over flaws in the sentencing process. The Attorney-General also refused to lodge an appeal. Ms Baird apologised and the judge in question has since rightly been promoted to the High Court Bench. There is an example of the Lord Chancellor acting in his traditional capacity.
	It is not only politicians who threaten the independence of the judiciary; the media do not hesitate to put improper pressure on judges as well. In September 2004, the Sun carried out a campaign against the noble and learned Lord, Lord Woolf, then the Lord Chief Justice. It asked readers to sign a petition requiring him to be sacked and sent removal men, as it called them, to the Royal Courts of Justice and even to his private home.
	Times have changed. It is in this context that we must judge the splitting-up of the Home Office, handing over responsibility for prisons and offender management to the Secretary of State for Justice, currently the noble and learned Lord the Lord Chancellor. The present Lord Chief Justice, the noble and learned Lord, Lord Phillips of Worth Matravers, in his appearance on Tuesday before the Constitutional Affairs Committee, expressed the judges' fear that the new ministry will be swamped by demands for resources from prisons and probation, its new responsibility. Judges want the courts to be given special protection as an arm's-length executive agency with a ring-fenced budget to protect their independence. The noble and learned Lord, Lord Howe, spoke of the need to preserve the integrity of the courts budget.
	It also emerged from the noble and learned Lord, Lord Phillips, that the noble and learned Lord the Lord Chancellor had learnt of the Home Office changes by reading about them in the Sunday Telegraph. I recall that I was negotiating with him the day before he was appointed to the Department for Constitutional Affairs. I swear that he did not know that that was going to happen either. That is not satisfactory.
	The noble Baroness, Lady Scotland, commented last Monday on the Lord Chancellor's oath, as read out by the noble Baroness, Lady Anelay, during our debate. The noble Baroness, Lady Scotland, said:
	"It is a powerful oath, which is aided by the only three words that she"—
	the noble Baroness, Lady Anelay—
	"did not read out and which some may think that he"—
	the noble and learned Lord the Lord Chancellor—
	"will need: 'so help me God'".—[Official Report, 21/5/07;col. 517.]
	The noble Baroness, Lady Scotland, also told us:
	"At present, those two posts"—
	of Minister of Justice and Lord Chancellor—
	"happen to be held by one person but at some future date, if another Administration wanted to do things differently, there would be nothing to prevent the two functions becoming separate because they are quite distinct".—[Official Report, 21/5/07; col. 477.]
	This, I thought, was contrary to everything that I had understood from the Ministry of Justice document Justice—A New Approach and to the implications of the statement made by the noble and learned Lord the Lord Chancellor to the House 12 days earlier, on9 May.
	Here, perhaps, is the solution to the problem expressed by the noble and learned Lord the Lord Chief Justice. Perhaps the noble Baroness, Lady Scotland, has acquired new expertise in translating the smoke signals coming out of No. 11 Downing Street. Give us back a Lord Chancellor, stripped of the additional tasks that have been imposed on the Ministry of Justice, a Lord Chancellor with sole responsibility for the core functions of his or her office. Give us back a judiciary with independence of executive interference, with, as the oath says,
	"the provision of resources for the efficient and effective support of the courts for which I am responsible".
	That would end what the noble and learned Lord, Lord Howe, described as the destruction of the office of Lord Chancellor. We would all be happy. And if he or she needs more work in the absence of the previous chores of the Woolsack or the Judicial Committee, which we have abolished, let the Lord Chancellor's oath be extended to give to him or her the duty to defend the independence of the Civil Service as well, under a long promised and much awaited Civil Service Act.

Lord Wright of Richmond: My Lords, I, too, am grateful to the noble and learned Lord, Lord Howe of Aberavon, for initiating this important and timely debate on the independence of the Civil Service and the judiciary. I hope that noble Lords will understand if I choose to concentrate on a separate branch of the public service, Her Majesty's Diplomatic Service, of which I had the honour to be Permanent Under-Secretary for five years, several of which I spent serving the noble and learned Lord himself when he was Foreign and Commonwealth Secretary. This no doubt accounts for his assumption that I am bursting with enthusiasm to speak in his debate today.
	At this important moment, when we face a change in No. 10 Downing Street, I sincerely, if not enthusiastically, urge the Government to take care to maintain and take full and proper advantage of the professionalism and experience of what I firmly believe to be the best Diplomatic Service in the world. Indeed, I have quoted before in this House the remarkable tribute paid by a former French Foreign Minister, Monsieur Couve de Murville, when he described our foreign service as the second best in the world. We all know to whom he gave first prize.
	When I retired from the public service in 1991, I realised that nearly half my colleagues in both the Diplomatic Service and the home Civil Service had served only under Conservative Governments. It is hardly surprising, then, that a new Labour Administration should have harboured some totally unfounded suspicions that the public service would find it difficult to adjust to new Labour policies, attitudes and objectives; hence, I suppose, the tendency to rely, to an even greater extent than previous Administrations did, on political and special advisers, on outside think tanks, on subcontractors, on celebrity reviews, and on what has come to be known as "sofa government". At this moment of change, I hope that a new Administration will bear in mind the unique asset that they have in the Diplomatic Service and will find ways of reverting to the traditional machinery of government to make the best use of this asset in the national interest, or in what the noble Lord, Lord Lipsey, referred to as the common national good.
	Other than through the passages from the report by the noble Lord, Lord Butler of Brockwell, as quoted by the noble and learned Lord, Lord Howe, I have no way of knowing the extent to which the Foreign and Commonwealth Office was listened to or ignored in the run-up to the Iraq war. But we have chilling evidence of the way in which the State Department was not only ignored but deliberately excluded from the consultation and decision process and from post-invasion planning, with disastrous consequences.
	I hope that Ministers will constantly bear in mind the contribution that the Diplomatic Service can and should make, not only to our foreign policy interests but to the Government's overall objectives in defence policy and counterterrorism. Several instances have been quoted in this House in the past year of posts that the Diplomatic Service has already been forced to close in Latin America, Africa and elsewhere. I hope that the next Prime Minister will bear in mind the damage that even minor post closures—very often with insignificant, if any, financial benefit—can cause to the national interest. On this 25th anniversary of the Falklands war, it is worth recalling the essential role that otherwise insignificant posts were called on to play in ensuring that we had sufficient support in the Security Council and world opinion to defeat the often misguided attempts to frustrate our recovery of the islands.
	A great deal has rightly been said in this House about the resource pressures on our armed services. I believe that it is of equal importance to maintain a professional and experienced Diplomatic Service; to preserve our outstanding record of training sufficient linguists and regional experts to fill relevant posts in the service; and, most important, to ensure that in the Comprehensive Spending Review the service has the resources it needs to fulfil what has traditionally been the objective of successive Governments—namely, a truly effective global foreign policy. The Government have a unique asset at their disposal. I urge them to give it the resources that it needs to promote and protect our national interests around the world.

Baroness Shephard of Northwold: My Lords, I congratulate my noble and learned friend Lord Howe of Aberavon on securing this extremely timely debate and on the truly masterly way in which he introduced it.
	We are a parliamentary democracy. Ours is not a perfect system, but, as Winston Churchill said, it is a good deal better than the other systems that have been tried from time to time. The system, like Parliament, has evolved and adapted to changing circumstances over many centuries, but its essence remains the same; namely, that the Government of the day owe their existence to Parliament and are accountable to Parliament. Parliament's role remains central. The 2001 Hansard Society study, The Challenge for Parliament: Making Government Accountable, says that Parliament,
	"performs certain functions which cannot be performed by any other institution ... It calls ministers to account for their actions, it seeks information and explanation from Government and where necessary, amendatory action, so as to improve the quality of government on behalf of the public".
	It follows therefore that, in any debate about the machinery of government, one of the criteria by which that machinery should be judged is whether it provides for the Government of the day to be held to account by Parliament, which, as the Hansard Society study says,
	"is the voice of the electorate between elections".
	The penalty for weakening that vital line of accountability between elector and elected is a weakening of public respect for democratic institutions and for democracy itself, which is why this debate is so important.
	My noble and learned friend has outlined some of the current confusions surrounding this issue under the present Government. I would say in support of the Government—any Government—that a combination of the 24-hour-a-day media coverage, the increasing globalisation of political and business interests, the obligations imposed by membership of the EU, the cult of celebrity, the rise of pressure groups and so on makes it difficult for the machinery of government to keep pace with changing circumstances. But I would add that, with such rapid change, much of which in itself is ungovernable, there is even more need for clear and transparent parameters for procedure. If the Government are serious about democratic accountability, they should address that issue as part of every planned policy change. In the brief time available, I want to examine three aspects: the establishment of quangos, agencies and the like; devolution; and the Civil Service.
	The establishment of the next steps agencies in 1988 was a change in the machinery of government. As a result of it, certain services would be delivered at arm's length from government. But as the then Prime Minister, the noble Baroness, Lady Thatcher, told the other place, there would be,
	"no change in the arrangements for accountability. Ministers will continue to account to Parliament for all the work of their departments, including the work of the agencies. Select Committees will be able to examine departmental agencies' activities and agency staff in the same way as they examine departments now".—[Official Report, Commons, 18/2/88; col. 1149.]
	Thus accountability was built in to that machinery change from the outset. Since 1997, literally innumerable agencies, quangos, regional bodies, task forces and review bodies have been set up by this Government, but I am not aware of the accountability of any of them being made clear. Indeed, I wonder whether the noble and learned Lord the Lord Chancellor will be able to tell us how many there now are. Their existence certainly puzzles the public, who know that they cannot turn to these bodies to hold anyone to account.
	The safeguarding of clear lines of accountability is even more important where devolution is concerned because it is not possible to alter one part of the system without consequences, possibly unintended, for other parts. In the case of devolution, becausethe consequences were not clearly thought out, the electorate are unclear about the duties and responsibilities of those whom they elect to be mayor, to devolved and local government bodies, to Westminster and to Europe. Mystification and apathy follow. I do not believe that the consequences of devolution for accountability were taken sufficiently seriously when Ministers were rushing to introduce it. In 1999, John Reid said in another place that,
	"there is no route map for it, and no text book".—[Official Report, Commons, 27/7/99; col. 103.]
	That is clear now. If we add to the inevitable overlap of powers and responsibilities caused by devolution the requirement that electors should also use three or four different methods when voting, we really should not be surprised that disillusion reigns. I hope that the noble and learned Lord will not take it amiss if I say that what is going on in Scotland and Wales as we speak is the result of unthought-out change in the machinery of government.
	An impartial Civil Service, mentioned in the Motion, is an integral part of our assumptions about the way in which our democratic system works. The system assumes a productive tension between the political and procedural imperatives, the Civil Service being the guardian of the latter. But its role now needs to be redefined, not only because of the influential, essentially informal and above all private role played by the hugely increased number of special advisers now operating in Whitehall—there were just 38 such advisers before the 1997 general election—but also because we hear with increasing frequency from Ministers, not least in their appearances before Select Committees, that civil servants must also be held publicly accountable. If that is the view of Ministers, the need for a Civil Service Act has become pressing. The role of the Civil Service and its relationship with elected politicians require urgent redefinition in a rapidly changing world. Perhaps the noble and learned Lord the Lord Chancellor will be able to tell us today whether we can expect a Civil Service Bill in the Queen's Speech, as was promised in the Labour manifesto. If Ministers believe that accountability also rests with the unelected, they should say so and legislate for it.
	The machinery of government has to change with changing circumstances. But such change must protect accountability and the role of Parliament. Those who fail to perceive that are damaging more than their own electoral chances. Therein lies the importance of today's debate.

Lord Maclennan of Rogart: My Lords, I add my voice to the felicitations offered to the noble and learned Lord, Lord Howe, on introducing the debate in a timely and percipient fashion.
	I believe—perhaps slightly against the argument we have just heard from the noble Baroness, Lady Shephard—that the Government began the process of constitutional reform effectively and have laid the foundations for the further work that needs to be done. The establishment of the Humans Rights Act, the opening of the Freedom of Information Act and the decentralisation of power, despite the teething problems, are all welcome and important. What remains to be done touches upon the management of central government; I want briefly, in the limited time, to headline the areas upon which I think the Government now need to focus.
	The first area is the extent to which news management has affected the priorities, presentation and content of administrative action and legislative proposals. This is not new; it is not an invention of the present Government. I remember the problems with the Dangerous Dogs Act, introduced by the Government who preceded them. The noble Lord, Lord Lipsey, is right to indicate that the public must be confident that the Government are acting according to their wishes and interests. Communication is a part of government but it should not dominate to the extent that it has in recent years. One example which springs to mind is that of the outgoing Home Secretary, Mr John Reid, responding immediately to the case of Margaret Dixon, whose surgery had been cancelled many times, by setting yet another target for hospitals, coupled with a fine for cancellation but not immediately resetting operations. The consequences for administration of such a diktat, the difficulties of monitoring and enforcing such targets and of reconciling their implementation with meeting other targets from within reduced funds, were certainly not worked out in answer to that communications crisis.
	The second vital area is the independence of the Civil Service and the machinery of Cabinet government, which needs to be reinvented. In what I believe is the foundation of the modern structures of executive central government in this country, the 1918 report of Lord Haldane, it is clear that a much closer relationship between the Civil Service and the Cabinet was envisaged—and properly envisaged, because it is a partnership which enables the delivery of Ministers' wishes and the proper investigation of alternatives to be thought out in advance. So anything which diminishes that kind of independent insight is extremely dangerous to the success of the system we have.
	Perhaps it had gone a little too far, or maybe it was too metaphysically understood, but certainly Sir William Beveridge, himself a Permanent Secretary, described the relationship between Minister and Permanent Secretary as being like that between man and wife, except that the Minister did not choose the Permanent Secretary and could not divorce him. There have been some attempts to divorce Permanent Secretaries in the past few years, and some have been indirectly successful. There has been—shall we say?—less than full cohabitation.
	None the less, we have heard a great deal over the past few years about a Civil Service Act, and the time has come for it to be implemented. Like other noble Lords who have spoken in the debate, particularly the noble Lord, Lord Wright, I cannot pronounce upon precisely how the Cabinet committee system is working at any time, but there are indeed shafts of light which have given some indication of its shortcomings. One of the remarkable pieces of information adduced by the noble Lord, Lord Turnbull, was his indication that Cabinet papers have increased in number from one in 1998 to nine in 2004. That, he said when he retired, was rather remarkable progress—not if you look back at the record of the Attlee Government, who produced 340 Cabinet papers in a year. Even under Mr Heath there were 140 Cabinet papers per annum.
	The reason for mentioning that—and it is not entirely a matter of redefinition—is that we are seeing the most appalling White Papers being produced, into which there has been no proper input from other Cabinet Ministers. The process of refinement is clearly not working effectively. Take the paper on planning this week. I am not an expert on planning, but it ought to be comprehensible to someone of reasonable intelligence. It is about as opaque a document as I have had the misfortune to try to read and understand, and I do not think I am alone in that.
	The third area where there is a need for change is clearly in the overload of central government. There is nothing that can be done about this that excludes the need and the possibility of decentralising government. I do not believe that devolution has been other than a success in Scotland and Wales, and I am clear that the differentiation of policy that is taking place in these parts of the country enables England to look at different ways of doing things and decide which are better. It is not purely for the advantage of the Scots and the Welsh.
	Above all, process and thoroughness are required, but I doubt whether the papers produced over the past few years reflect that in a way that would have given pride to some earlier Administrations. I hope that these things will change under the new Prime Minister and am rather confident that we are starting in a good way with an open mind about these machinery questions.

Lord Dean of Harptree: My Lords, I add my thanks to my noble friend for introducing such a timely and important debate. I shall briefly mention three subjects: secondary legislation; advisers in Whitehall, who have been referred to already by most noble Lords who have spoken; and freedom of information.
	Under all Governments, the number and importance of secondary legislation—orders and regulations—have increased out of all recognition. Alas, parliamentary scrutiny has lagged behind. I am delighted that we now have the Merits of Statutory Instruments Committee in your Lordships' House, which is able to point out to us the merits and demerits of secondary legislation coming out of Whitehall and Brussels. That is a great step forward. It should improve our performance in scrutinising the vast amount of secondary legislation that comes out.
	The House retains the right to reject secondary legislation. It does so very unusually, because that is something of a blunt instrument. I would like to see the House have an opportunity to amend regulations. I am glad to see a number of noble Lords nodding their heads about that. I do not mean wrecking—that would be wholly inappropriate—but the wisdom and experience in your Lordships' House could be valuable in suggesting to the Government of the day that what they want to do could be achieved more effectively in another way. It would be valuable if the House were able to suggest constructive amendments so that the Government could think again.
	My second point, on consultants and advisers in Whitehall, has been referred to by most noble Lords who have spoken. There has been a very substantial and, in my view, disturbing increase in recent years, which sits uneasily with the established Civil Service. It tends to weaken the long tradition in our country of the trust and relationship which should exist between Ministers and civil servants.
	Political advisers have been mentioned. The best adviser to a Minister is the Minister himself. All Ministers are Members of either the Commons or the Lords. They should know, better than any outsider, what will be regarded by Parliament and the public as feasible, reasonable and desirable. The number of advisers, particularly political advisers, has increased, is still increasing and should be diminished.
	My third point, on freedom of information, is allied to that. It is the duty of civil servants, as the noble Lord, Lord Lipsey, reminded us, to give advice to Ministers. Sometimes that advice will be unwelcome; sometimes it will be rejected—Ministers are of course perfectly entitled to reject it. The safeguard is in Parliament—Ministers are answerable to one or other House of Parliament, where there will be rigorous questioning of their activities. But advice that is given in private should remain private, otherwise the relationship between Ministers and civil servants could easily be undermined. It would be quite wrong for journalists or busybody individuals to extract that sort of advice; it would be a great mistake, and contrary to the traditions of government in this country.
	I believe that the case has arrived, on this and other aspects, to review the Freedom of Information Act in the light of experience. On these three areas, some action is required, either by this Government or the next.

Lord Wallace of Saltaire: My Lords, I take it from the predominance of Conservative speakers that this is seen as a debate attacking the Government. I want to address the problem of the style of government, which stretches back to 1979. If we were to have a new Government headed by Mr Cameron, we would see very much the style of government that we have seen with Tony Blair. After all, the self-image of Government, since Mrs Thatcher became Prime Minister in 1979, has been as radical reformers, battling against obstructive public service providers. There is deep suspicion of the producers and professionals, be they doctors, teachers or judges—or, for that matter, social workers or probation officers—and a bias towards the consumers of public services. People are treated as consumers rather than citizens, who are to be empowered by being given a wider choice.
	There are three elements in this approach. The first is fast government. We have talked about permanent reform—almost permanent revolution—in which Governments produce initiatives every day as far as they can. In an excellent article on policy disasters in British Government, published in 1995—before Labour came in—my colleague at the London School of Economics, Patrick Dunleavy refers to the British style of government as wanting to be the fastest Government in the west. In Britain and New Zealand, Ministers could produce an idea in the morning, shove it through Parliament as fast as possible, implement it in no time at all and discover two years later that it did not work. The poll tax is a classic example, but there are many others.
	This is not something we have suffered under Tony Blair alone. Indeed, we see that David Cameron has a new idea every day; designed to catch the media. The fact that he has not consulted his party is not entirely important; the fact that his party dislikes it is even better in some ways. I am not sure that we would see a fundamental change in style if we had a change of Government.
	Patrick Dunleavy also spoke about political hyperactivism, in 1995. Constant initiatives by Ministers are driven by the media agenda. If in doubt, Ministers reorganise. There have been three reorganisations of the National Health Service since 1997, but four between 1979 and 1997. Ministers are constantly churned. I think that John Reid takes the record overall over the past 25 years, having had nine posts in 10 years, but Ministers rarely stay in office long enough to carry out the policies they have proposed. I recall Patricia Hewitt, as Secretary of State for Trade and Industry, launching a five-year plan for the department, three months before she was moved. The five-year plan sank relatively rapidly.
	The second element of this style of government is overcentralisation. It began with Mrs Thatcher and continued under Tony Blair, from the impatience by Ministers at the centre with the pace of implementation at local level. There are further and further restrictions on local government, tighter and tighter targets, more and more detailed instructions landing at the front doors of primary schools and hospitals.
	The third element is the faith in fashionable techniques of management and in management consultants. Rather than responsible officials, apparently, management consultants are not considered to be self-interested although officials, doctors, teachers, judges, and so on, are of course seen as self-interested. By some estimates, some £6 billion has been spent on management consultants since 1997.
	I have consulted a number of academic experts on new public management over the past year. Christopher Hood, now the Gladstone Professor of Government at Oxford, talks in The Art of the State about the fashion of Reinventing Government—the classic book by David Osborne and Ted Gabler, which inspired first the New Zealanders and then the British: He says:
	"Modernity is seen as inevitable, ushering in an era of global convergence around a single best practice model of public management, with a belief in a millennial, once for all transformation of public management underpinned by the emergency of a common vocabulary of management-speak in Government by total quality management, business process engineering and empowerment".
	Even the Parliamentary Information and Communication Technology unit is going through a programme of change management this week, I am happy to see.
	I taught some years ago at the national management college, where I note that senior officials are now being trained to be change managers. Not stability managers, not executors of what Ministers want, but change managers. There is constant churning in every single way.
	Radical reform is pressing even further. We hear from Tony Blair, as he departs, that he most regrets not pushing faster and further on public sector reform. The Home Office document which responded to the report of the noble Lord, Lord Carter of Coles, on offender management said:
	"As part of our radical programme of public service reform, we now need to go further".
	It does not tell us why we need to go further, it just says that we need to.
	Offender management, with which some of us are currently struggling, seems to many of us to be a classic example of what the public administration experts call overcommitment. You take a model and apply it to more and more sectors until it no longer works, as with the outsourcing model developed for the oil industry when applied to the maintenance of the railways.
	Unjustified claims for novelty are part of this. Management experts sell us new and modern administrative innovations tried out generations ago. Pay for performance was phased out in English schools in 1902. The ID card scheme was not possible before computers, but Jeremy Bentham proposed that the problems of identity that plagued public administration could be resolved by the compulsory tattooing of all babies at birth.
	We have an underlying problem with the style of government. Returning to a Conservative single-party Government would not resolve our problems. Fast government is like fast food—it leads to indigestion and imposes increasing stresses on the system. We need slow and considered government of a very different style. That requires a different relationship between Parliament and the Executive, whatever Prime Minister or party is in power.

Lord King of Bridgwater: My Lords, I congratulate my noble and learned friend on the timeliness of this debate. I not sure that he knew when he proposed it that there would be such a vast amount of material to be adduced in support of the thesis that the present system of management of government leaves a lot to be desired.
	I was struck today by a newspaper article byMr Peter Riddell, who is not the most tabloid of journalists, on the new Ministry of Justice. He said that the changes had been handled in a "typically inept way" and that the new ministry had been introduced in "a similarly crass manner". That is a pretty severe verdict. When one considers the background of the Rural Payments Agency, HIPs and doctors marching in the streets in protest at the shambles that has been made of their future career prospects, one realises that there is an extraordinary amount of material to suggest that things are not well.
	The noble Lord, Lord Wallace, referred to Patricia Hewitt introducing a five-year plan and being almost certain to be moved on three months later. She introduced it in the expectation that she would carry it out. We also see a quite extraordinary situation in the Home Office. The present Home Secretary has introduced a total convulsion in its operations, knowing perfectly well that he has no intention of being there to carry it out. I should have thought that it would have been polite in normal circumstances to have told the Lord Chancellor and the Lord Chief Justice of a change of quite such profound significance rather than their having to rely on the Sunday newspapers to find out. It might have been more polite also if the person who is to be charged with this responsibility had had some involvement in considering whether the changes could be effectively achieved. Not only will the Home Secretary not be around to see it through, but the other person who authorised this extraordinary rush, the Prime Minister, will not be there either. They have passed on to their successors what may prove to be a very challenging role. I suppose that it is part of the final triumph and chapter of the Prime Minister's career. We are told that it has been planned for the past two years by a team in Downing Street. It should be subtitled, "How not to govern the country". Events in recent weeks indicate that it is not a clever way for a Prime Minister to hand over responsibility for the top office in the land.
	A number of noble Lords referred to special advisers—I appreciated in particular the comments of the noble Lord, Lord Lipsey. They were just beginning to appear in my day—I did not qualify for one when I first became a Minister. Gradually, one saw special advisers creeping in and the bad habits starting. Those habits have reached a peak now. Some special advisers have an admirable and professional contribution to make; others appear to do little more than provide special PR support for the Secretary of State or the Minister concerned. I read that one Secretary of State has a special adviser whose brief is to get as many favourable references to his Secretary of State as possible in the press every day. If that is being paid for out of public funds, it shows just how far the perfectly legitimate role of special advisers may have been abused.
	Noble Lords have referred also to consultants. There is a perfectly good role for responsible consultants to play. Many distinguished firms are making a lot of money out of government and the public sector. I see that the National Audit Office says that £7.2 billion was spent on consultants last year, with no proof of any benefits. I do not accept that; I am sure that there must have been some benefit somewhere. However, it has become a culture—I have had personal experience of this. It goes back partly to the lack of professionalism in certain areas of the Civil Service. The use of consultants is undermining the Civil Service's chances of bringing higher levels of professionalism in house. One deals with a new issue or problem now by putting it out to consultants, because, that way, one does not have to take responsibility. You have ticked the box; the consultants are taking it on; and they produce their report. They may employ people who are far less qualified and experienced than the civil servants who are using those consultants, but if the report has PWC or Accenture or somebody else's name on the cover, it is assumed that they must be professionals and know what they are doing. That is the procedure.
	It is a serious matter in two respects: first, it costs a lot of money; secondly, it costs a lot of time. It is a wonderful way to bury something and wait for it to come round again in time. The cost to the country is doubly serious. I read that Sir Stuart Lipton, discussing this matter in connection with the Olympic Games, said that the jibe being made is that the cost of consultants for the Olympics, employed by the Treasury, DCMS, the Olympic Development Authority and LOCOG, led by our noble friend Lord Coe, will exceed the building costs. That may or not be true.
	My next point relates to reshuffles. The knowledge that the Prime Minister is going leads inevitably to a semi-paralysis in government. I recognise this from the time when we were in government. When there is a rumour of a reshuffle, everybody starts to look over their shoulders and civil servants do not pay so much attention because they think that the Minister will not be there for much longer. Continual change is a problem. If noble Lords need ultimate proof of the inadequacies of the present system, I remind them of what the noble Lord, Lord Wallace, has just said. Mr John Reid has done nine different jobs in 10 years. It is a recipe for disaster. One cannot expect out of that any quality in policy-making or any quality of experience.
	My final point is not necessarily a party-political attack on the Government, because, as the noble Lord, Lord Wallace, said, all governments are under pressure to make instant decisions. It is essential that properly considered policy-making through a properly structured relationship between Ministers and civil servants is restored. Sofa government has got to go. I hope that that will be understood by the incoming Prime Minister as well. I hope that he will understand that the present Prime Minister—I say this with regret—has been far too casual about the standards of conduct in public life. One does not have to listen just toSir Alistair Graham's expressions of outrage at the way in which his committee has been ignored. If Lord Nolan, whom we sadly miss, were here, I think that he would have some very similar things to say. There is no question that standards in this Government have been set far too low down the line—I do not know whether it is done by PR and communications staff in Number 10 or by whomever it is who responds to the press when these issues arise—and I hope that the new Prime Minister will see that the standing of government and Parliament is too low. He will have first responsibility to correct that.

Lord Lyell of Markyate: My Lords, if I needed a text to summarise the Prime Minister's position in relation to the policies that I wish to criticise, I would adapt, indeed distort, the famous words of Lincoln: "Conceived in ignorance and dedicated to the proposition that he must at all costs appear radical". I, too, congratulate my noble and learned friend Lord Howe of Aberavon on initiating this important debate and on his powerful and timely speech. I shall reflect briefly on the constitutional changes in relation to the position of the judiciary and the position of the Lord Chancellor as it now remains.
	It is astonishing that, in the declining years of his historic term of office, the Prime Minister should have inflicted on the country two such hastily conceived and ill-thought-out policies: first, the decision in 2003 to seek to abolish the position of Lord Chancellor and to push the judiciary out of Parliament into a so-called Supreme Court; and, now, the creation of a new so-called Ministry of Justice, combining two major Home Office functions and the Lord Chancellor's responsibility for the judiciary and the Courts Service. It is quite inconsistent with our historic constitutional procedures that such major constitutional changes should have been introduced without any of the normal processes—without Green Papers, without White Papers, without consultation and without even full and careful consideration within the Civil Service beforehand.
	Both policies appear to have been dreamed up by Tony Blair and his Home Secretaries with the very minimum of consultation even within government. First, there was David Blunkett in 2003 and, today, there is John Reid. Both changes come against a background of recent unlicensed criticisms of judges by both those Home Secretaries—I applaud the noble and learned Lord the Lord Chancellor for criticising that—and, given that the noble and learned Lord, Lord Irvine, the former Lord Chancellor, seems to have been sacked largely because he was rightly standing up for the judges against such unconstitutional attacks, the situation in 2003 was literally shocking. That shock is plain for all to see on the face of the noble and learned Lord, Lord Irvine, in the fine portrait of him in the Peers' Dining Room. The artist made no secret of the fact that that is what he saw, and that is what he painted; he did us a service.
	The second remarkable thing about these two radical changes is their inconsistency. The argument given for the first was that the position of the Lord Chancellor in the 21st century had become an anomaly—a word that, like "modernisation" and "perception", often seeks to disguise sloppy thinking or specious argument. It was said that his role as a member of both the legislature and the Executive, and as head of and therefore a member of the judiciary, constituted a breach of the so-called doctrine of separation of powers. That was a false analysis, but the present proposal for the Ministry of Justice is undoubtedly a breach of that doctrine and, as the judges rightly point out, raises the prospect—indeed, the inevitability—of real conflicts of interest between the three roles of the new Minister.
	The new Minister has a duty properly to fund the courts so that the judges can do justice and pronounce sentence according to law with adequate funding and without constant, albeit subtle, ministerial and departmental pressures. Out of the same budget, though it may be dressed up to look different, he must also fund the prison and probation services and other training provision to enable those sentences to be carried out. In all his functions, he—and I am looking at the noble and learned Lord, Lord Falconer—is going to feel those tensions. But the one that offends against principle will be the inevitable tendency of the Lord Chancellor to lean directly or indirectly on judges to make do with less than they properly feel that they need to perform their judicial duties in the public interest.
	The present Lord Chancellor is at least an experienced lawyer, but his successors are likely to be in the House of Commons and/or to have no legal background whatever. That is what you see in France with the Garde des Sceaux; it works in France for quite different reasons, because the judges are often civil servants for a substantial period of their judicial careers. I cannot believe that we wish to go down that route. As is at least paid lip service to in this House—and I hope sincerely—an independent judiciary is an absolute essential for a free society, as is an independent prosecuting service and law officers who know in their bones that it is their absolute duty to protect through their superintendence the independence from government of the prosecuting process and the independence and high efficiency of the legal advice, however unpalatable, that needs from time to time to be given to the Government.
	I revert to what I believe are the fundamental misunderstandings and the consequent damage to the British constitution caused by the changes in 2003 embodied ultimately in the Constitutional Reform Act 2005. Earlier this week on the "Today" programme, Dominic Grieve, the shadow Attorney-General, was asked whether the Conservatives would change the position back if we were in government. He rightly temporised, saying that we would have to wait and see exactly what sort of mess we were in at the material time. However, the prospect and possibility of reverting back would have a sound constitutional basis and should be carefully explored over the coming years.
	The problem is that the Constitutional ReformAct 2005 was founded on a fundamental misunderstanding. Our constitutional democracy is one of the most stable and successful in the world, and the foundation of its success is that every power of governance in its widest sense is accountable to Parliament. In relation to the judiciary, accountability lay not through individual opinions on cases—that would be something quite different—but through the Lord Chancellor for the good, sound and properly funded working of the system, just as the prosecution process, which must be equally independent, was accountable through the Attorney-General. Both those high officers of state were answerable and could be condemned if they got it wrong. Indeed, we remember—although there are a lot of historical nuances to this—the importance of the Campbell case in 1924, which brought down the first Labour Government.
	We need to return to the importance of constitutional propriety and correct machinery if we are to be guided in the right direction. That is why I so strongly congratulate my noble and learned friend Lord Howe on securing this debate. Institutions are important and should be restored.

Baroness Noakes: My Lords, I congratulate my noble and learned friend Lord Howe on hitting the jackpot by selecting this topic for debate. My modest qualification for speaking today is that I was twice seconded into the Civil Service, where I spent a total of five years. The first time was in 1979, in the Treasury. A couple of weeks after I arrived, the new Chancellor of the Exchequer was my noble and learned friend, which is why it gives me particular pleasure to speak in his debate today. It is to the subject of the Treasury that I shall address some of my remarks.
	One thing that I learnt when I became a part of the Civil Service temporarily was the clear separation between what Ministers and the Civil Service did. The Civil Service advised Ministers in an independent and impartial way and Ministers made decisions. That clear separation was reflected in the formal way in which Ministers were addressed by their title and not their names. Now things are different. I am sure that civil servants still try to serve Ministers in an impartial and independent way, but formality has been replaced by familiarity. Even quite junior civil servants now refer to their Ministers by their first name, both in the Ministers' presence and separately. I know that we live in a world where formality reigns and deference has diminished, but I cannot but think that this informality is a sign that the clear distinction between Ministers and those who serve them has broken down.
	I also learnt about special advisers, to which several other noble Lords have referred. Their role was to give Ministers advice that was political in nature, which was not the role of the civil servant. Special advisers certainly did not have any direct control over civil servants, and there were not many of them. Not only have their number increased in the past 10 years, but it is now explicitly the case that some of them can direct the work of civil servants. I believe that a very important line was breached when that occurred. We saw it in No. 10, but also in the Treasury.
	The Chancellor of the Exchequer, in the face of opposition from his Permanent Secretary, appointed Mr Charlie Wheelan to run the Treasury's press operation. That unhappy experience lasted less than two years. But perhaps of more significance is the case of Mr Ed Balls. Having worked for Gordon Brown in opposition, in 1997 he was appointed as the Chancellor's economic adviser, which was a special adviser post. Two years later, he crossed over into the Civil Service and became the Chancellor's chief economic adviser; he stayed there until 1995, when he became a parliamentary candidate for the seat that he now holds. Did anybody believe that Mr Balls was anything other than a political adviser to the Chancellor throughout that whole period? I think not.
	In addition, the Chancellor has a Council of Economic Advisers, which has been estimated to cost more than £1 million a year. Five of its members are appointed on special adviser terms. Why did the Chancellor find it necessary to gather advisers around him in this way when he was surrounded by the undoubted intellects who exist in large numbers among Treasury civil servants? Has the advice of his civil servants been replaced and, if so, why was that necessary?
	It is not surprising that some of the Treasury's Permanent Secretaries and other civil servants have found working with the Chancellor's regime very difficult. If they did not adapt to the Chancellor's way of doing things, they found it difficult to survive. His way of doing things was well documented in an excellent book by Mr Tom Bower, entitled Gordon Brown. This included bypassing the Civil Service way of documenting meetings and decisions; that was also a feature in the report produced by the noble Lord, Lord Butler, which has already been referred to.
	Perhaps none of this would matter if the end result was excellent policy brilliantly implemented, but that has not been the case. I give two examples. One example of failed Treasury policy is tax credits, which my noble and learned friend referred to. Tax credits were very much the brainchild of the Chancellor of the Exchequer. The system has been characterised by fraud and error. The latest figures show fraud and error running at more than £1 billion a year, or 9 or10 per cent of the total amount. Its design—pretty nearly incomprehensible to the ordinary people whom the credits were intended to assist—has resulted in incorrect payments each year. The latest figures, which were released this week, show overpayments each year of £1.7 billion and underpayments of £550 million. The proportion of payments that were correct was only 55 per cent. To date, not a single Minister or civil servant has apologised for the human misery caused.
	I do not know what advice Treasury and HMRC officials gave when the system was introduced or when it started to go wrong. Did those civil servants give bad advice, or did they give advice that so conflicted with the Chancellor's desire to implement tax credits quickly that they were ignored? For example, did officials advise that spending half a billion pounds a year on a £25,000 income disregard to conceal the mess was the right or the wrong thing to do? Did they frame their advice to save the Chancellor's face or did he over-rule their advice?
	My second example is the efficiency programme that the Treasury has overseen, fronted by Sir Peter Gershon and said to deliver annual savings of£21 billion. The Chancellor claimed late last year that it had delivered £13 billion. We have only to turn to the National Audit Office's version of that, released a few weeks ago, to find that only £3.5 billion,
	"fairly represents the efficiencies made".
	The remaining 73 per cent was dodgy in one way or another. Where were the civil servants? Did they know that the figures did not stack up? Did they advise the Chancellor not to claim a value of delivery that was not supported? Did he go ahead anyway?
	I do not believe that the Civil Service has lost its independence and impartiality in the past 10 years, although I am sure that it has been severely tested. A generation of civil servants has learnt about the relationship between government and Civil Service under a Government who, by their actions, if not by design, weakened the structure. I hope that my noble friend Lord Strathclyde will affirm that our party is committed to restoring the standards and practices that underpin a strong and independent Civil Service.

Lord Goodlad: My Lords, I join other noble Lords in congratulating and thanking my noble and learned friend Lord Howe of Aberavon, who introduced today's debate in his characteristically pellucid and penetrating style.
	My noble friend Lady Noakes, who has just spoken, rightly lamented the informality which has been sought to be introduced between Ministers and officials. I remember many years ago when I first took office—I think it was me; it could have been two other fellows—in some obscure Ministry, I rolled up my sleeves and said to the Private Secretary coming in with a pile of papers, "We have work of national importance to transact. I shall call you Bernard and you must call me Alastair". I see that the noble Lord, Lord Wright of Richmond, anticipates the reply, which was, "Yes Minister".
	In any event, your Lordships' Select Committee on the Constitution is currently preparing a report on the relationship between the Executive, the judiciary and Parliament, which I trust will be properly debated in due course. As the noble Lord, Lord Thomas of Gresford, and my noble and learned friend Lord Lyell of Markyate said, the Lord Chief Justice, the noble and learned Lord, Lord Phillips of Worth Matravers, gave evidence to that committee, and to the committee in the other place, the day before yesterday. It is reported that he said in written evidence that—as the noble Lord, Lord Thomas, said—the judges had known about the new Ministry of Justice only when they read about it in an article by the Home Secretary in the Sunday Telegraph. He is also reported to have said that under the Constitutional Reform Act 2005, which made him rather than the Lord Chancellor the head of the judiciary, the views of the judges should always be taken into account by the Lord Chancellor, and that they were not. He is reported to have said, "We were sidelined; decisions were taken without our participation and we were then told what was proposed".
	This situation beggars belief. The short-term answer to the present impasse between the judiciary and the Lord Chancellor is that an inquiry should be held into the right model for the Ministry of Justice and into how the courts budget can be protected from raids by the Prison Service or, as happened recently, the legal aid budget, or, indeed, anybody else. How on Earth have the Government got into this mess? Surely there must be a way of avoiding a repetition ofthis fiasco, which echoes what happened in 2003 when the abolition of the office of Lord Chancellor was announced without prior consultation with all those involved, to the incredulous bemusement of everybody, including our friends overseas, resulting in the shambles which followed.
	I think that two things are needed. One is a sea change in the attitude of the new Administration towards changes in the machinery of government. It is no longer adequate to say that this is a matter for the exclusive jurisdiction of the Prime Minister in exercise of the royal prerogative—the so-called Ram doctrine. There has in recent years been a substantial expansion in the use of the prerogative. I am not arguing for prior legislative authority for changes in the machinery of government. The era of the statutory creation of departments from the mid-19th century until the 1960s was accompanied by growth in the functions of modern government. The Departments of Health, Social Security, Education, Employment, Agriculture and others all trace their origins to statute. When, after the Second World War, powers were first taken to transfer functions by ministerial order, it was anticipated that new departments would continue to be established by statute. However, in recent decades the prerogative has been exercised to transfer functions, most recently under the Ministers of the Crown Act 1975.
	I am all in favour of economising on the need for legislation, but Parliament should in future be consulted about changes in the machinery of government. After all, that is part of what many people think Parliament is for. There is in your Lordships' House and the other place a wealth of experience that could and should be brought to bear in debates on any future eye-catching proposals for changes in the machinery of government in Green Papers, White Papers or substantive Motions.
	In your Lordships' recent debate on the Select Committee on the Constitution's report on war-making powers, the noble and learned Lord the Lord Chancellor mounted a robust defence of the status quo in the Government's use of the prerogative, only to have the rug unceremoniously pulled from beneath his noble feet by Jack Straw in the subsequent debate introduced last week in another place by William Hague—with the incontrovertible slogan by Jack Straw that God moves in a mysterious way, as he signalled that the Government now agree that the time has come for making more explicit Parliament's role in approving, or otherwise, decisions on major or substantial overseas deployments of British forces into actual or potential armed conflict. Nothing is more popular than a sinner called to repentance.
	In seeking to discourage impetuosity in those under his command, the Duke of Wellington used to employ the expression, "Damn all that eagerness". A change in the Government's attitude to the use of the prerogative, a careful revisitation of the so-called Ram doctrine, and the inclusion of Parliament in considering future decisions about the machinery of government—at the very least where constitutional implications are involved—would avoid the unnecessary fiascos of recent times and lead to better governance and government. I hope that the noble and learned Lord the Lord Chancellor will be able to give your Lordships some comfort in that direction in the terms that he used two or three weeks ago, or even more fulsomely.

Viscount Eccles: My Lords, I need immediately to admit that I went to the same school as my noble and learned friend Lord Howe of Aberavon. However, he was at the time very senior. I knew all about him, but I, being very junior, was unknown; such is life. I need to go cautiously, because many years later my noble and learned friend was my ultimate boss in the then machinery of government. He was, on one occasion at least, following the advice of his Foreign Office officials, briefed in their turn no doubt by the Treasury. He asked me, as the chief executive of the Commonwealth Development Corporation, to agree to a change in the CDC's governance arrangements. I demurred. It would be going too far to say that the Foreign Secretary was cross, but I did receive a sharp rebuke. For a while, until I retired, the governance went unchanged, and then the Civil Service got its way. The CDC has since gone below the radar screen, but that is another story. Such is the machinery of government.
	Ever since those days, I have followed as best I could the relationship between the Government and the Civil Service and its impact on the many agencies of government. It is instructive to go back to the days when these matters seem to have been more securely handled—securely perhaps in both senses. There were, in the 1950s and 1960s, lines in the sand between the two parties of government, lines that were redrawn in the 1980s. Since then, both parties have mostly seen the need to move away from their ancient certainties, and now we are all in the muddled middle ground, which is where the electorate wishes us to be, at least in domestic politics, seeking empirical solutions rather than a priori political progress. Indeed, it was that perception that enabled old Labour to become new Labour.
	This middle ground of domestic priorities greatly complicates the position of the Civil Service. The much-quoted case of the changes to the role of the Bank of England is a rare exception, because the issue was significant and straightforward and thus easy to understand. Most domestic issues are not like that; poverty, social exclusion, drugs and the irreducible minority of young men who each commit over 100 offences a year when not in prison. There are many other issues with no consensus either between or within the main parties. In that confusion, the Civil Service has no easy way of predicting which direction the political system will take, and yet it has to deal with a flood of legislation responding to and subject to instant communications.
	It is always easier to see a problem than to propose solutions. Maybe, among the choices to be made, there are two ways forward. First, for all our secular concentration on domestic issues, and for all our confidence in the non-ideological middle ground, ideology has not gone away. Iraq and Afghanistan have shown us that in clear and unexpected ways. Then there is Africa, which is unwilling to deal with the recalcitrance of Mugabe and unable to deal with its civil strife. Other examples abound. How does Europe cope with Russia? Is there a positive role for us in Israel and Palestine? Foreign affairs are not subject to the consensus of the domestic middle ground. No Administration will get the level and accuracy of their diplomacy right without the open advice that a skilful and well-resourced Diplomatic Service could again provide. A resurgent Foreign Office would do wonders for both the confidence of the nation and the confidence of the rest of the Civil Service.
	The second issue is also one of decentralisation. The answer is not regional government, because, as the ever-practical electorate knows, and showed in the north-east, any issue thought to be regional turns out to be better dealt with nationally or locally, but not in between. What we need is resurgent local government. All the difficult domestic issues fall into the local government front-line, which needs the delegated authority and the funding streams to deal with these accountably.
	Regrettably, we run scared of the media, which would never welcome decentralisation. However, if it were achieved, it would free up central government and the Civil Service to take things national forward with much greater professionalism and diligence. We need to stop skating on the thin ice of instant response. No Civil Service can cope with that, and only salesmen pretend to do so.

Lord Hamilton of Epsom: My Lords, I, too, congratulate my noble and learned friend Lord Howe of Aberavon on introducing the debate, which is certainly widely drawn, giving us the opportunity to talk about how the Government have operated since 1997. It strikes me as rather strange that the Labour Benches seem to have very little interest in this subject. Perhaps that says something about both the Government and the Labour Party and their interest in the constitution generally, which, let's face it, has changed dramatically during the past 10 years, not always for the good.
	I think it was the noble Lord, Lord Wright of Richmond, who said that when the Government were elected in 1997 they very much took the view that because the Civil Service had served a Conservative Government for so long it must somehow have been extremely biased. That was used as an excuse for the enormous expansion of the number of political advisers and senior outsiders appointed. One thinks here of Jonathan Powell, who was brought in as chief of staff in Downing Street, no doubt depriving some ambitious civil servant of a prime promotional spot in his career. A large number of political press officers were brought in as well.
	Having served my noble friend Lady Thatcher as her PPS in Downing Street when she was Prime Minister, I was honoured—I put it no less strongly than that—to have served at the same time as Charles Powell, now the noble Lord, Lord Powell of Bayswater, who served with her for a very long time. Sir Bernard Ingham was there as her press officer at the same time, and also served with her for a very long time. No one would suggest that either of those civil servants had failed their Prime Minister in looking after her interests. It is outrageous to say that somehow civil servants can become over the years so tainted by the Government of the day that they cannot serve a new Labour Government, who, let's face it, have not produced policies dramatically different from those of the Conservatives. The appointment of so many political advisers was a vote of no confidence in our Civil Service and could only have damaged it.
	The problems go further than that. Having so many political appointees as press officers is counterproductive. My noble friend Lord King of Bridgwater mentioned that one political press officer had the job of obtaining press references for his Secretary of State as many times as possible. The relationship with the press is always a two-sided business. You have to give favours, provide bits of gossip or whatever, to get somethingin return. That was alluded to by Peter Clarke, the Deputy Assistant Commissioner responsible for terrorism, in a speech on 24 April, when there was a serious problem regarding the leak of information about police inquiries into terrorism in Birmingham. He talked about,
	"small numbers of misguided individuals"
	who perhaps look for some way to work favours with certain journalists. That is typical of our problem, and I am sure that he was alluding to special advisers.
	We know that the relationship between the Prime Minister and his Chancellor has been bad, but that has been exacerbated by the activities of political PR people who have never missed an opportunity to stir up that trouble and make a political problem within the Government even worse.
	One of my great concerns is the use of public servants to present policy. Peter Clarke also defended his senior colleagues in the police in their handling of the debate in the House of Commons regarding periods of detention. Noble Lords will recollect that MPs were rung up by their chief constables who were very keen to permit 90 days' detention without trial and thought that they should lobby their MPs to make that happen. Peter Clarke asked if his colleagues should have remained silent. That was a rhetorical question to which he expected the answer to be "no". I say unequivocally "yes", they were expected to stay silent. Senior police officers should lobby Ministers with what they want, and then Ministers should be in the position of persuading Parliament, using the Whips and everything else that they have at their disposal, to get legislation through. It is not the job of chief constables to lobby Members of Parliament on legislation. The proposal for 90 days was soundly beaten in the House of Commons, a good outcome. I hope that the chief constables have learned their lesson and will not go down that road again.
	Not only are chief constables used by the Government but the military have found themselves being wheeled in. I am sure that that is to do with the view taken by the Government that military officers in uniform have much more credibility than Ministers. When the controversial issue of whether we should go into Kosovo was being considered, I was concerned that the noble and gallant Lord, Lord Guthrie—to whom I have written to say that I would mention him—started writing articles in left-of-centre newspapers advocating that we should go to war. Under any interpretation of the constitution of this country, the decision to go to war is for Ministers and the Government. The role of the military is to carry out that decision when it has been made. It was a retrograde step that has been continued by a number of chiefs of staff in promoting such actions. We must get back to the constitutional position whereby Ministers should defend policy and the military carry it out.
	This reached an absurd point when hostages were recently kidnapped by Iran. At that stage, Ministers took the view that they should go completely schtum. We did not hear from a single Minister in the Ministry of Defence regarding what was going on, despite widespread interest among the media and the public. I hope that we will return to a clear constitutional position in which Ministers and the Government are responsible for setting down public policy, while civil servants, whether in uniform or otherwise, are there to give advice and to carry out the policies decided by Ministers.

Lord James of Blackheath: My Lords, the noble and learned Lord, Lord Howe, spread before us a great feast of wonderful things to eat, and we can all choose what we would take, but I doubt that we can finish the entire banquet, because there is so much on the table. All we can do is mark some factors for future reference and hope that the cakes are baked for us again.
	I would like to talk about my experiences of the accounting officer system and the role and function of the Public Accounts Committee. I am talking very much about the departmental role, which has been a constant theme in our debate. I had never heard of an accounting officer until about 4.10 pm on 4 September 2000, when I emerged from the boardroom of the New Millennium Experience Company as its new executive chairman. I was confronted by two individuals who announced themselves as members of TSol—I had never heard of it, but they turned out to be Treasury solicitors, who I now know to be government enforcers who have a level of fearsome authority that would make the Praetorian Guard in imperial Rome look like Mary Poppins in a good mood.
	They told me that I had to do something immediately about agreeing the appointment of my accounting officer. "What is an accounting officer?", I asked. They said, "The person responsible for reporting everything that the department and the Permanent Secretary need to know to pass on to the Public Accounts Committee". I told them that I was not going to have anyone do that for me and that, if I was going to be executive chairman, I would do it myself. "No, you can't", they said, "you mustn't do that". I said, "In that case, find yourselves another chairman". They said that they would go away to talk about it; they came back and said, "Okay, you can be the accounting officer but you must agree to go on a training course to be taught how to do it". We agreed on that basis.
	The next day I received a telephone call from the Permanent Secretary, who said that he wanted to help me in this matter and asked me to talk to him. I said that I would, so long as I could take my solicitor with me, because I never go to anyone who wants to help me without a solicitor. At the start of our meeting, the Permanent Secretary gave a detailed explanation of the role of accounting officer. When I asked exactly what an accounting officer does, he said, "You die for your Permanent Secretary". I said, "Really? Who are you going to die for?". He said, "I am going to die for my Minister if I have to". I said, "Lucky Minister, but I did not know that government was quite as awful as this".
	The Permanent Secretary said, "Look, I'm really worried; I do not think that you have the experience to be an accounting officer. You should not do it. There is a Public Accounts Committee meeting in four weeks and you will never be prepared in time". We discussed the issues that might arise; he was particularly concerned about two matters being discussed in the press. The first was that I had said that the accounts of the Dome were a shambles, and the second was that I had criticised the role of Jenny Page, the previous boss of the Dome. I said that it was true that I had said the Dome's accounts were a shambles but added, "I have never said a word against Jenny Page, who I regard as a saint comparable to Joan of Arc—indeed, they both suffered the same fate".
	The Permanent Secretary said, "You can't go on like that. We must give you some further help to ensure that you can handle this and give the right answers to the Public Accounts Committee". I said, "There is no way that I can avoid telling the truth to the Public Accounts Committee, is there?". He looked across the table at me and said, "Pass. You need to protect previous accounting officers. Lying is unfortunate, but the extent to which you say what happened before was wrong can give difficulty". At this point, I pressed the matter further and asked him what on Earth that meant. I said, "I cannot say anything which is a public statement of untruth". He said, "You have an obligation to protect the position of all accounting officers, including my own. You don't lie but you don't go out of your way to make the position of previous accounting officers difficult". I replied, "I cannot lie in response to a direct question from the Public Accounts Committee", and there the matter rested more or less, with a further promise of more help to come.
	The next morning I got another phone call from the Permanent Secretary saying that he had arranged for the Civil Service training college to run a special course for me alone to teach me how to deal with the Public Accounts Committee. I duly presented myself at the training college, where I found that a complete mock Public Accounts Committee had been assembled, comprising some dozen former Permanent Secretaries and senior civil servants, all of whom had been armed with questions that the PAC might like to know. They ran the questions past me and made a video recording of everything that I said. They then came back and analysed all my answers. They told me what I should have said instead and rehearsed me until I was word perfect. At that point, they thought that I was fit to be let loose on the Public Accounts Committee.
	In the event, that worked perfectly, except for the fact that, as I sat down, I was overcome by a dreadful attack of the illness known as CRAFT, which your Lordships will know stands for "Can't Remember A Flaming Thing". I could only tell the Public Accounts Committee the facts as I truly remembered them. The irony of it is that, today, the video recording of that PAC is now used by the Civil Service training college as the model of how to handle a difficult Public Accounts Committee.
	This was not a political initiative. No part was played in it by the noble and learned Lord, Lord Falconer, in his former earthly manifestation as Minister for the Dome. Never at any stage did he try to persuade me or impose anything on me. However, I think that here we have a system created by the Civil Service, which is frightening itself more than anyone else with the apparent authority of the Public Accounts Committee and accounting officers. It should stop.
	Government tell us that we should have a process of governance in business, but why do they not do the same? They have created a perfectly good governance system, including the role of the compliance officer, which does not have the stark, harsh realities of the accounting officer but does everything else in terms of keeping an individual in line with the procedures of government. Let us have compliance officers and stop the current nonsense. The present arrangement opens up a department to bringing undue and unreasonable pressure to bear on individuals, however it goes about it, and is aimed at telling not what the Government or the department want to hear but its version of the truth. That is wrong.

Baroness Park of Monmouth: My Lords, once again we are deeply indebted to the noble and learned Lord, Lord Howe of Aberavon. The noble Lords, Lord Wright of Richmond and Lord Lipsey, have between them said what I wanted to say, but far better, about the decimation of the foreign service and the growth of a third world of private advisers in the UK which has so largely eroded the role of the Civil Service and usurped to some extent its function as dispassionate adviser and its duty to advise and warn. I have had to rewrite my speech; I hope noble Lords will forgive me if I cannot always read my own writing.
	What has gone wrong has been the simultaneous arrival of the unaccountable political adviser in large numbers, both inside and outside government, and the failure of both the Cabinet and the House of Commons to protect our vital political and defence interests and, above all, to restrain one department—the Treasury, or perhaps I should say an over-powerful Chancellor—from making critical decisions, particularly in the field of defence and foreign affairs, based solely on immediate financial considerations: money for the Treasury. An example is the long-term and nearly irreversible cost to our influence in the world, especially in the UN—the noble Lord, Lord Wright of Richmond, made the point about the Falklands—derived from saving the cost of a small post at the expense of long-term influence. I could give many similar examples from defence—not least that, since the Navy cannot have bases everywhere to support an, often unforeseen, operation, it is all the more important to preserve the right diplomatic relationships with countries which will allow us access to bases when we need them. That point was made in one of the defence papers.
	Equally, the creation of so many think tanks, the Prime Minister's own strategic unit among them, has not only done serious damage to the departments of state which should be the prime source of advice and action, particularly in foreign and defence affairs, but it has helped to create expensive armies of special advisers and experts to produce glossy reports. The unit's paper Investing in Prevention employed two FCO, three DfID and three MoD people, and 32 others, including the ubiquitous McKinsey, to advocate closer co-operation—and many more analysts to ensure co-operation— between the FCO, DfID and the MoD in Whitehall; and to have more "thematic strategies" in the UK to guide priority setting for country engagement. No one seems any longer to recognise that the right answer is probably to return to embassies, where defence and commercial attachés, the British Council and development worked together under one roof, and where DfID focused on development but was not regarded as the voice of the whole national policy. In a number of countries, particularly Africa, the large, independent DfID missions are already coming to be regarded as the real voice of the UK. Do we want that?
	Let us not forget the vital role of the embassies in the fight against terrorism and the practical control of immigration through, for instance, the biometric data produced by our embassies in Ethiopia, Eritrea and other African countries. In tackling increasingly complex situations, there is a need for much more coherence and, above all, what was called in the Army "boots on the ground". It is no use living and planning in London. The interests of the UK, as the FCO has itself said, are best served by having an extensive network of overseas posts operated, full time, by FCO personnel. Posts wholly staffed by the locally engaged would be an invitation to trouble if there were ever a coup.
	Where posts have had to close—in central America, for instance—or where the FCO cannot open them because of financial constraints, such as Kyrgyzstan, this country is inevitably likely to suffer a diminution of trade, influence, first-hand information and, not least, continuity. In the old days, not so very long ago, you served in a country as a very junior person. You probably went back 15 years later, and at once had access where it was needed because you had grown further and so had your friends in the country. That is missing from a constant stream of lively, interesting special advisers who do something for five years and them move on to do something else. There is no continuity there.
	Perhaps one of the most dangerous results ofthe detachment of DfID from the FCO by the Government, however, has been the resulting failure to relate its activities, where they are political, to the central foreign policy of this county, of which it should be a part. I have no doubt that there is a great deal of consultation in this country, but perhaps not enough. There have been problems in Ethiopia, for instance. But the most glaring example of the danger of giving DfID independent status must surely be Clare Short's letter of November 1997 to the Mugabe Government when she assumed power as the Secretary of State for DfID:
	"I should make it clear that we do not accept that Britain has a special responsibility to meet the costs of land purchase in Zimbabwe. We are a new Government from diverse backgrounds without links to former colonial interests. My own origins are Irish and as you know we were colonised not colonisers".
	She went on:
	"I am told Britain provided a package of assistance for resettlement in the period immediately following independence. This was, I gather, carefully planned and implemented, and met most of its targets ... Again, I am told there were discussions in 1989 and 1996 to explore the possibility of further assistance. However that is all in the past".
	It is not surprising that "New Africa", a glossy and much-read magazine, published a special supplement in May, paid for by the Zimbabwe Government, which printed her letter—which was in other ways a deeply patronising document—in full. It remains a valued tool in Mugabe's campaign against Britain.

Lord McNally: My Lords, the noble Lord, Lord James, described what the noble and learned Lord, Lord Howe, had put before us as a banquet. No greater tribute could be paid to the initiative of the noble and learned Lord in bringing this debate tothe House than the quality of the contributions. As the Prime Minister-designate goes off on Recess, he would profit from taking with him the Hansard of this debate. It has not been a partisan debate. The introduction of the noble and learned Lord, Lord Howe, contained an element of the case for the prosecution, as any good QC would use, but I am sure that he has a worthy adversary in the noble and learned Lord the Lord Chancellor, who will put the case for the defence. In the main, however, there has been a recognition that many issues that we have been talking about predate 1997 and will face us whatever and whoever is in Downing Street in the future.
	Before 1997, I participated in one of the most useful cross-party exercises, serving on a committee jointly chaired by Robin Cook and my noble friend Lord Maclennan, which looked, on behalf of the two then opposition parties, at the need for reform of governance in its widest sense. My noble friend Lord Maclennan referred to the more sure-footed approach to reform shown in the first period of Labour government, which was partly because of the thorough work done by Cook and my noble friend.
	Let me slightly depress, or perhaps inspire, your Lordships with what is coming down the track. Last night, I attended the Royal Society of Arts launch—chaired by the noble Lord, Lord Filkin, and attended by Jack Straw, Mr Hutton and other Ministers—of a report by a Labour think tank, the Public Service Reform Group. Among the ideas in its report are suggestions for a deep and lasting reform of the Civil Service, major devolution of power, a new deal between central government and public service, a democratically elected House of Lords, proportional representation in local government and a Bill of Rights to enrich the citizen/state relationship.
	So I say to those who were thinking that the steam had gone out of the desire for reform that it is clear that there is plenty on the agendas of these groups. Before the Conservative Benches get too indignant,I should add that there is a regular stream of suggestions coming from various Conservative think tanks and study groups. That means that, whatever happens in our politics over the next few years, constitutional reform will remain on the agenda. I have sometimes disagreed with the noble Lord, Lord Norton of Louth, but I think that his idea of havinga royal commission on the constitution is worth studying. If there is such fertility of ideas in these outside groups, it is worth seeing how we could bring them together in an over-riding way.
	When summing up a debate, it is unfair not to mention noble Lords who have contributed. Without being an expert on these matters, I think that when the noble and learned Lord the Lord Chancellor replies the House will want to hear a considered response to the concerns about the judiciary that were expressed on all sides with considerable weight.
	There is a need to get something clear from the Government about a Civil Service Act. The situation is ridiculous. The Cook-Maclennan agreement committed to a Civil Service Act and almost every inquiry has to a greater or lesser degree come down in favour of one. We are delighted to see the noble and learned Lord the Lord Chancellor in his place. We usually get the noble Lord, Lord Bassam of Brighton, in his role as the good soldier vejk, dead-batting proposals by telling us that preparation for the Civil Service Act is under way somewhere in the machinery of government. If the Government are not going to implement a Civil Service Act, let them explain to this House the good reasons why. There has been enough evidence in speeches today to put forward the idea that, if we are going to go through a further period of reform of our public service, we must, in fairness to those who work in it, give them the guarantee and underpinning that comes from a Civil Service Act.
	Nearly 10 years ago, I had the pleasure of serving on a committee of this House under the noble and learned Lord, Lord Slynn, that looked at the impact of the changes that had taken place under the Thatcher and Major Governments on the morale of the Civil Service. We came to the conclusion that the ethos of public service that had been part of the pride of the British Civil Service was still intact. Ten years on, it would be interesting to have another inquiry about the impact on the Civil Service of the Labour Government's reforms. I do not think that the Government would be as enthusiastic as they were in 1998, when they thought that the committee was going to produce a litany of the wickednesses of Thatcherism. Nevertheless, the case for a Civil Service Act is important. I am always mindful of the remark made by the noble Lord, Lord Sheldon, that the two great gifts we inherited from the 20th century are our Civil Service and the BBC. These Benches can take some pride in our Civil Service because it is based on the Northcote-Trevelyan principles of selection on merit and quality of candidature.
	It is extremely difficult to cover all the points that have been made in this debate. On freedom of information, I disagree with the noble Lord, Lord Dean, because I think that it has helped to end the culture of secrecy to a certain extent and should be supported. I agree with him on the need for scrutiny of secondary legislation. The Merits Committee has been doing an excellent job, but we have to look further at how we deal with such legislation. There is talk from all parts of House about further devolving powers from Whitehall and Westminster, although there is a debate about whether power should be devolved locally or regionally.
	I think that the malevolence of special advisers is overemphasised. The number of them in the Civil Service is relatively small, and there is now an impressive group of alumni special advisers, including the present Leader of the House of Commons and former Foreign Secretary and the present leader of the Conservative Party. The introduction of people into politics by coming through the system has its benefits. In 2003, the Committee on Standards in Public Life produced a good report about special advisers, which is worth revisiting.
	We had a call for a strong Foreign Office, especially from the noble Lord, Lord Wright of Richmond, and the noble Baroness, Lady Park, and I endorse it.
	We face a broader challenge in the debates about quality and choice, whether the public service should be a provider or a commissioner and the issue of centralisation or decentralisation. This is a big agenda, and it may take a royal commission. It certainly merits cross-party co-operation and a little humility on all sides. Let us remember that as the Prime Minister walks out of Downing Street, people will still be singing,
	"Things can only get better".

Lord Strathclyde: My Lords, I join all noble Lords who have spoken in expressing my gratitude to my noble and learned friend Lord Howe for introducing this debate. In office, he was known for his impeccable respect for the conventions of public life, and he is right to highlight their importance. Public confidence in our democratic system depends on appropriate government conduct.
	We are also grateful to have the noble and learned Lord the Lord Chancellor with us. He is probably the finest exponent since the late Lord Goodman of what the noble Lord, Lord Butler of Brockwell, so memorably described as "sofa government". I have no doubt that, from the perspective of the sofa, he will give us a typically relaxed response, but I trust it will not be complacent, for the scale and range of concern at the recent style of government is evident from many of the compelling contributions to this debate.
	Noble Lords have identified consistent areas of concern: an Executive with too much power, policy making driven by short-term headlines with too little thought given to the difficult and necessary task of implementation and the cavalier treatment of Parliament, the Civil Service and constitutional conventions. I join with those who argue for a strategic study of our constitutional arrangements, perhaps even a royal commission. The state of our union, the role of Parliament and the independence of the judiciary all need to be looked at and re-examined in the light of the changes that have taken place over the past 10 years. As my noble and learned friend Lord Howe concluded, the result has been restless and poorly thought-out change. In the NHS, in endless Criminal Justice Bills and in the constitution, we have seen the Government ceaselessly pushing through so-called reforms at great cost but with minimal coherence. They called it joined-up government; how sad that it lacks the joins.
	Too often, when faced with a problem, the Government's response has been to wheel out a new law. Badly thought-out legislation is passed with great fanfare to win short-term publicity, only to require further "reform" two or three years later. More care is given to spinning headlines than to drafting a Bill or assessing its effects. The effect has been longer and more complex legislation, frequently without proper scrutiny.
	As my noble and learned friend pointed out, the other place has been hobbled by overuse of instruments to curtail time. In the half century before 1997, only 67 Bills were guillotined. Under this Government, 94 Bills were guillotined in their first six years alone; and programme Motions limiting Commons scrutiny are now routine. The Commons filter has broken down; it needs to be restored.
	Deplorably, action was recently threatened to impose time restrictions on this House. Thanks to the committee chaired by the noble Lord, Lord Cunningham, the 60-day rule was buried; and it must never be resurrected.
	Far too much strain falls on your Lordships' House to make up for the inadequacies of the other place as a legislative body. It has only limited authority to insist on its case, however right it may later prove to be, as on ID cards, postal ballot fraud or, this week, on HIPs. Parliament must be brought back to the centre of the nation's affairs. Government is strengthened by securing the support of a strong Parliament.
	Respect for this Government has suffered because they have sidelined Parliament by making major policy statements outside it. Indeed, there are now three Chambers of Parliament, and the supremacy of the "Today" programme studio is undisputed. That must stop.
	Cabinet government, too, has been undermined. That damages the quality of government. The three most recent Cabinet Secretaries have all commented adversely on the modern style of government, as has almost every noble Lord speaking today. Properly conducted Cabinet government, the full process of collective discussion with proper papers and minutes, is the basis of effective government; it must be restored.
	The Butler report revealed that crucial meetings on the legality of the Iraq war, some involving the noble and learned Lord the Attorney-General and the noble and learned Lord the Lord Chancellor, were not minuted. Why not? Will the noble and learned Lord tell us why not when he makes his winding-up speech? Was it because of fear of exposure through the Freedom of Information Act? Why not tell us now? After all, he was there.
	Expenditure on publicity and spin has expanded in inverse proportion to time spent on considering decisions. Public funds spent on advertising in 2004 rocketed by nearly 20 per cent to £189 million, leaving Whitehall second only to Procter & Gamble in advertising expenditure. It is hard to say whose soap is softer or dissolves more swiftly. Would that the same care were attached to policy planning. The most senior of the judiciary had barely half an hour's notice of the abolition of the office of Lord Chancellor, one of the most extraordinary examples of insouciant discourtesy recorded in modern public life. How much notice did they have of the creation of the Ministry of Justice? Will the noble and learned Lord tell us? After all, he was there on both occasions.
	There is unwillingness inside government to accept responsibility. Indeed, failure too often goes rewarded. Blundering Ministers, who should be scouring the atlas for the Chiltern Hundreds, are instead anticipating promotion. Even departments, publicly condemned by their own Ministers—a thing astonishing in itself—as "not fit for purpose" get rewarded. Home Office bonuses have reached £3.6 million, a staggering 75 per cent rise in five years, despite serious failures that put public safety at risk.
	My noble and learned friend rightly mentioned encroachment on the Civil Service by political interference. The Prime Minister's first act was, disgracefully, to give Mr Alistair Campbell unprecedented executive power over civil servants. Decisions are taken by claques of advisers meeting without civil servants. The number of special advisers has more than doubled since 1997, while their cost has more than trebled. The noble Lord, Lord Lipsey, was so right when he examined the qualitative difference between special advisers now and then.
	The noble Lord, Lord Levy, whose resignation as envoy this morning will no doubt be greeted with consternation in capitals across the world, is only one example of the friends of people in high places being used to bypass proper civil and diplomatic service channels.
	The existence of an independent, professional and objective Civil Service has been a resource of incalculable importance to the British state. This Government have never fully understood the nature or value of that resource, and that lies behind many of their worst decisions. How much I agree with my noble friend Lady Noakes that Civil Service independence must be enshrined in statute. I join the noble Lord, Lord McNally, in asking for a response to the perennial question about a Civil Service Bill.
	The concerns expressed today by my noble and learned friend Lord Howe, the noble Lord, Lord Thomas of Gresford, and many others over judicial independence are also deeply disturbing. Has the noble and learned Lord the Lord Chancellor yet reached agreement with the judiciary on ring-fencing its resources and protecting it from political interference in his new Ministry of Justice? If not, why is he plunging ahead with such haste? When this process began, many on all sides warned where it might lead, but the noble and learned Lord gulled the judiciary into thinking that their independence could never be threatened. He promised a "concordat"; yet within a year the department that promised it was abolished. Now we see the looming reality: political responsibility for judicial affairs assumed by ambitious career politicians in another place with the power to pull the purse strings if judges do not do the Government's bidding.
	Many may laugh this off, but how do we know that the noble and learned Lord, for instance, will still be there in a month's time and that the judiciary will not be lining up to report to the next Mr Blunkett? Yet again major change, effected with neither forethought nor consideration for the balance of a constitution that had guaranteed peace and freedom in these islands for the past 250 years—a record unequalled anywhere in the world.
	Why do the Government continually alter things to no obvious benefit or purpose? Why do they persist in all this tinkering with policy and shuffling of the structures of government? What is behind it all? It remains a mystery. But what is abundantly clear is that there is something rotten in the state of modern British governance, and we will have to call on some old wisdom and ancient virtues to set it right.

Lord Falconer of Thoroton: My Lords, I join noble Lords who participated in this timely debate in congratulating the noble and learned Lord, Lord Howe of Aberavon, on securing it. I congratulate him also on the quality of his speech; like all his speeches, it was incredibly impressive. He also started the debate in a tone that led to a very impressive non-partisan discussion.
	The noble and learned Lord is a dangerous man because he is a powerful advocate. He stands before us today as an advocate of the need to be careful about certain changes. It is not without interest that he was, if history is to be believed, a major conspirator in one of the most major constitutional changes ever to strike this country: our entry into the European Union. Again, if history is to be believed, he drafted the European Communities Act 1972, the first Act in recent times to change—I do not complain about this; it was the right thing to do—parliamentary sovereignty by acknowledging a higher power to Parliament. That has led to substantial changes not only in our constitution but in the quantity of law as well. It is therefore right that we should acknowledge his role in major constitutional change and listen very carefully to what he has to say about how we go about it in future.
	As quickly as possible, I take up the invitation of the noble Lord, Lord McNally, to deal with the important issue of the independence of the judiciary, without in any way undermining any other contributions made, to which I shall come. The noble Lords, Lord McNally, Lord Strathclyde, and Lord Thomas of Gresford, the noble and learned Lord, Lord Howe, the noble Lord, Lord Norton of Louth, and the noble and learned Lord, Lord Lyell of Markyate, all referred to that. As noble Lords will know, one of the main responsibilities of my post as Lord Chancellor is to protect the independence ofthe judiciary. That independence is a fundamental and long-standing aspect of our constitution. Our constitution depends on it. An independent judiciary is essential to the rule of law.
	William Blackstone wrote in his Commentaries on the Laws of England, that judicial independence is,
	"one main preservative of the public's liberty".
	I agree completely with that assessment and I believe that our system protects the independence of the judiciary more clearly than ever before.
	That is what we achieved in part by the passage of the Constitutional Reform Act. The noble and learned Lord, Lord Howe of Aberavon, and the noble Lord, Lord Thomas of Gresford, suggested that the creation of the Ministry of Justice may either change the role of the Lord Chancellor or, as the noble and learned Lord, Lord Howe, put it, put him under intolerable conflicts that lead to a reduction in the defence of the independence of the judiciary. I reassure them that that is not the case. The creation of the Ministry of Justice does nothing to reduce the responsibilities of the office of Lord Chancellor in protecting judicial independence. Nor, in practice, does it reduce his ability to do so. The Lord Chancellor's statutory duty to defend the independence of the judiciary and to uphold the rule of law remains and the new ministry will continue to enhance the close working relationship that has developed since 2005 and before between the Executive and the judiciary.
	I take this opportunity to set out the constitutional position, because it is of great importance in the current public debate. Section 1 of the CourtsAct 2003 places a statutory responsibility on the Lord Chancellor properly to resource the courts system. Schedule 7 to the Constitutional Reform Act 2005 ensures that, short of primary legislation, responsibility for the courts remains with the Lord Chancellor. Section 3 of the 2005 Act places a specific obligation on the Lord Chancellor to preserve the independence of the judiciary. So the person who has specific obligations to preserve its independence also has responsibility for running the courts.
	The courts are administered by Her Majesty's Courts Service, which is an executive agency of the Ministry of Justice. It is not a quango but a part of the ministry. It is accountable to the Lord Chancellor, who is in turn accountable to Parliament. Success in running the courts requires that the management of Her Majesty's Courts Service is left to get on with the operational management. A successful partnership between Her Majesty's Courts Service and the judges is vital to that success.
	Ministers, including the Lord Chancellor, should interfere rarely in either budget or management issues, subject only to the Lord Chancellor being obliged to comply with his Section 1 duty properly to resource the Courts Service. There will be times—for example, in relation to big budgeting issues or issues of legitimate public concern such as court closures—when the Lord Chancellor will want to be involved or that it is right that he should be involved. On such budgetary or management issues, agreement with the judges will always be sought.
	Since I have been Lord Chancellor, although there have been issues on which points have been raised by judges—for example, on budgetary cuts which have occasionally been required for the courts—the judges and Her Majesty's Courts Service have always co-operated fully. The current structure was set up in the wake of the concordat and the Constitutional Reform Act 2005. It was set up and endorsed in the context of the Lord Chancellor not being a judge or head of the judiciary. It was set up in the context of the Lord Chancellor being—if not now, in future—a full-time politician.
	The creation of the Ministry of Justice also does not change the nature of the Lord Chancellor, who remains both a non-judge and subject to the Courts Act 2003 and the duties under the Constitutional Reform Act 2005 to defend the independence of the judiciary. Equally and rightly, the Lord Chancellor retains responsibility for the courts.
	As noble Lords have pointed out, the creation of the Ministry of Justice gives the Lord Chancellor additional responsibility and a larger budget, including that for prisons. There needs to be a clear and unambiguous procedure ensuring both that judges are involved in the setting or changing of the courts budget and that the Lord Chancellor's involvement in budgeting and managerial issues is exceptional and transparent. There need to be efforts to reach agreement, which I have always found possible. If there is not agreement, there need to be means to resolve such disagreement. Although the Lord Chancellor's view on the administration of the courts should ultimately prevail, in the unlikely event of a disagreement continuing, such disagreement can be reported to Parliament by either the Lord Chancellor or the Lord Chief Justice. That reflects the current position. The Lord Chancellor's obligation to ensure that sufficient money is available for the courts is underlined by Section 1 of the Courts Act 2003.
	I believe that there need to be in place clear and transparent arrangements to ensure that the partnership arrangements and the relationship between the judiciary and the Executive can work as I described. In the past few weeks we have substantially negotiated those arrangements in detailed documents, which are now largely agreed. Those arrangements have been discussed between my officials and senior members of the judiciary. We are very close to agreement on the detail of those arrangements.
	However, the judges pose one additional question. If our objective is to achieve a situation wherethe courts' budget and independence is properly preserved, is it necessary to have the courts run by an agency separate from central Government and significantly accountable to the judges? My answer to that is an emphatic no. No such separate agency is required, nor would it be right to have one. There must be proper parliamentary accountability for the provision of the courts. There needs to be profound judicial involvement; there needs to be partnership; and, where there is disagreement, Parliament needs to know.
	That approach is the basis by which I have proceeded with the Ministry of Justice. That is the basis on which the working party, which has sought to negotiate those arrangements, was set up on 19 March 2007—10 days before the announcement that the Ministry of Justice was to be created on 9 May. The Lord Chief Justice, aware of those arrangements, said on 2 April—a few days after the announcement was made, and after the arrangements had been set up—that, subject to safeguards to protect the due and independent administration of justice, there would be no objection in principle to the creation of a new ministry with responsibility for both offender management and the courts service.
	Subject to reaching final agreement, which we have not yet done, we will be in a position to publish the detail of what has been arranged. The right course at this stage is to put those arrangements in place. By all means let us review how they work having given them an opportunity to work, but they reflect how our arrangements have worked in the past. The creation of the Ministry of Justice does not, in my view, in any way affect the independence and standing of the judiciary, as long as those arrangements are transparent and open, as I believe that they are.
	We have also discussed today the position of the Civil Service. The Civil Service is part of the Executive and, as the Civil Service Code puts it, its role is to,
	"support the Government of the day in developing and implementing its policies, and in delivering public services".
	The Civil Service is rightly impartial. It is not intended to be independent of the Executive, because it is part of the Executive. The noble Lord, Lord Norton of Louth, rightly said that Ministers and civil servants have an interdependent relationship with each other. That said, the Civil Service is founded on the principle that civil servants are appointed through fair and open competition, without political interference, and that they are promoted on merit rather than due to any sort of political affiliation.
	Those are long-standing principles, but not ancient ones. "Where is the application of the principle of public competition to stop?", asked Queen Victoria nervously when it was first proposed by Northcote and Trevelyan, two officials from Her Majesty's Treasury. Their proposals are now enshrined in the Civil Service Code, which defines the core values of the Civil Service as integrity, honesty, objectivity and impartiality. The Government are utterly committed to those core values. A new Civil Service Code was launched on 6 June 2006. The code is now more relevant and accessible to all civil servants, whatever their jobs and wherever they work, whether in Whitehall or in a Jobcentre Plus. The Government have consulted on a draft Civil Service Bill. We have the results of that consultation and will make a statement in due course; I am not in a position to make a statement this afternoon.
	Several noble Lords, including the noble Lords, Lord Wallace of Saltaire and Lord Wright of Richmond, and the noble and learned Lord, Lord Howe of Aberavon, have suggested that the Government have relied too little on the policy advice and expertise of the diplomatic corps and the Civil Service. I hope that that has not been the case. The choice, as it has been put in the debate, is not either/or. It is absolutely right that Ministers should rely heavily on the advice that they receive from the Civil Service, as long as they are transparent and open about what alternative advice they see and make it public, as they do in inquiries such as those that have been conducted by the noble Lord, Lord Carter of Coles, or by the noble Lord, Lord Turner, into pensions. Not only is it not wrong to do that, it is wholly right, because one needs as wide a reach of policy advice as possible.
	I am quite sure that the Government benefited hugely from consultative services provided by people such as KPMG. Indeed, the noble Baroness, Lady Noakes, used to help to provide such services when she was a consultant and not seconded to the Government. I was disappointed that she did not say whether the services provided by consultants such as KPMG were of value to the Government at the time. KPMG is one of the biggest providers of such services, from which we have benefited over the years, as have previous Governments. The Prime Minister summed up the Government's approach to this issue. As he put it:
	"The Civil Service has strengths that are priceless. And the greatest is indeed its integrity. That comprises not just its impartiality, but an ingrained, pervasive streak of honesty. It knows the difference between obeying legitimate political orders and impropriety. It knows it by instinct and it executes it without fear or favour".
	I must say that that is my experience, too. No Minister would be wise not to rely on it completely, but they would also be wise to get advice from other sources.
	My noble friend Lord Lipsey and other noble Lords suggested that the Government have operated sofa-style government. Indeed, the noble Lord, Lord Strathclyde, suggested that I was one of the greatest exponents of that. I am not sure whether that was a reference to my girth or to the way in which I formed policy. I am very glad to see noble Lords behind him protesting at the suggestion that that was the basis of the remark made. One should not confuse informality with rigorous processes not being used; they are used wherever necessary.
	Accountability was another theme of many noble Lords who have taken part in the debate. The Government have introduced a transparency that did not exist under previous Administrations. We were the first to publish annual lists of gifts received and visits undertaken, and the Prime Minister is the first to appear before the Liaison Select Committee, which he does twice yearly. Best practice guidance on records management is published and constantly reviewed to ensure that it is relevant and up to date with international best practice. It is easy to point to changes, many of which, as the noble Lord, Lord Wallace of Saltaire, correctly said, point to a change in the process of government in the past 20 or 30 years. We, as a Government, have rightly sought to keep up with the changes in pressure and circumstance that apply to government.
	The speech of the noble Lord, Lord Wallace of Saltaire, was very interesting, because he referred to the idea of government being conducted too fast, although those were not his exact words. That is plainly a reflection of the times in which we live, in which the media constantly drive Governments in particular ways and communication right across the world is so easy, with people having so much more ready access to information. I could not agree more with him that it would be very good indeed if one could slow down the process and the demands made on politicians, executives and civil servants throughout the world. The question is whether that is possible, given the landscape in which politicians and civil servants currently operate.
	This connects closely with the points made by the noble Lord, Lord Norton of Louth, about our constitution. We do need to step back and give it period of thought. I suspect that it would be almost impossible, no matter how distinguished a body is set up, to come to holistic conclusions about what we want our constitution to do. Never in this country's history have we had a one-paragraph description of our constitution. The changes that have been made have always been made bit by bit. To go back to where I started, it is interesting that perhaps the most significant constitutional change of all was joining the EU. In the 20 or 30 years while we waited to join it, as we discussed, I suspect that the actual impact of that constitutional change was never foreseen. I am not inviting him to answer at this point, but I wonder whether the noble and learned Lord, Lord Howe of Aberavon, ever had any conception of what the effect of the European Communities Act 1972 would be as he drafted it.
	I have not dealt with all the points that have been made. The noble Baroness, Lady Shephard of Northwold, made a very important speech on parliamentary accountability. I completely agree with her basic theme that parliamentary accountability is absolutely vital in ensuring that the public feel connected to the processes by which they are governed. I cannot tell her now how many quangos and non-quangos there are, but I will write to her with the answer. I completely agree with the noble Lord who said that this is a debate which it will pay to reread. It has been thoughtful and worthwhile, and we have learnt a lot from it.

Lord Rooker: My Lords, with permission, I shall repeat a Statement made earlier today in the other place by the Secretary of State regarding waste strategy. The Statement is as follows:
	"With permission, I should like to make a Statement about the Government's waste strategy for England, which I am publishing today. Copies are available in the Vote Office and the Printed Paper Office. Each year we generate about 100 million tonnes of waste from households, commerce and industry combined. Most of this currently ends up in landfill, where biodegradable waste generates methane, one of the most powerful greenhouse gases, accounting for about 3 per cent of UK greenhouse gas emissions. Meanwhile, much valuable energy is used up in making new products which are later disposed of, also contributing to climate change. "We need, therefore, not only to recycle and reuse waste but to prevent it in the first place. The waste strategy published in 2000 has delivered a step change in performance. Twenty-seven per cent of household waste collected by local authorities in 2005-06 was recycled or composted, compared with only 7.5 per cent 10 years earlier. Recycling of packaging waste has doubled to 56 per cent over the same 10 years. There has been a 9 per cent fall in waste being landfilled between 2001 and 2005, and household waste is now growing much less quickly than the economy at about 0.5 per cent per year. "Despite this progress, England's waste performance still lags well behind much of the rest of Europe. Other countries landfill far less and recycle and recover energy from waste much more. But all countries face a challenge in reducing the growth of waste and it is waste reduction which produces the greatest environmental benefits. "This strategy sets out national standards, while increasing local flexibility over how to achieve them. It provides a range of tools for individuals, businesses and local authorities to do the job. "Our key objectives set out in the new strategy are simple: less waste, more reuse and recycling, more energy from waste and less landfill. Each part of society can play a part in achieving these objectives. The first step is for producers and retailers to help prevent waste and to take greater responsibility for ensuring waste is recycled. We have identified key waste materials where waste can be reduced or recycled, including paper, plastics, glass, wood, aluminium, textiles and food. To achieve this, we are establishing voluntary agreements with industries to reduce and recycle waste. For example, there are more than 350 million pieces of unaddressed direct mail every year, so we have agreed with the direct mail organisation to make arrangements for individuals to opt out of mail of this sort, and we will consider an approach where people get direct mail, addressed or unaddressed, only if they choose to receive it. We will also reduce the environmental impact of carrier bags by 25 per cent in the next 18 months—equivalent to 3.25 billion fewer bags a year or the greenhouse gas emissions of 18,000 cars—and to work for the end of free single-use carrier bags."The reduction and recycling of packaging is an important symbol of change. The Government will take action in two areas. First, in consultation with industry, we will seek to further minimise the amount of packaging used, for example by setting optimal packaging standards for certain products, so that producers would be expected to use the lightest weight packaging wherever possible. In addition, I am writing today to Commissioner Dimas urging the European Commission to review the provisions of the EU packaging directive so that member states' authorities can take more effective enforcement action against clear cases of excessive packaging. Secondly, we will need further to increase the rate of recycling of waste packaging. Subject to analysis, the Government will propose higher recycling targets for the period beyond 2008 and I have also written to the commissioner about this. "The second step to achieving these objectives is investment in infrastructure. Our aim is to ensure investment in facilities that collect, sort, reprocess and treat waste by local authorities, businesses and the third sector. Alongside kerbside recycling, we want to stimulate the provision of much better recycling facilities in places of public access: I am delighted that those who represent many of the operators of airports and railway stations, alongside the Royal Parks, have signalled their support for a drive to make recycling easier in places under their management. We will also establish a 'zero waste places' initiative to develop innovative and exemplary waste practice. Through the private finance initiative, enhanced capital allowances and the proposed banding system for renewable obligation certificates, we intend to support a variety of energy recovery technologies. We expect energy from waste to account for 25 per cent of municipal waste by 2020, compared with10 per cent today. This includes anaerobic digestion, which creates energy from food and other natural waste. According to the early evidence, the separate collection of household food waste on a weekly basis results in higher levels of recovery. Up to20 local trials on best practice in this field are being undertaken. The third sector has a significant role to play in achieving social and environmental objectives. The waste and resources action programme will therefore be developing a new programme to build capacity further in third sector organisations to enable them to maximise their contribution. "The third step is to use incentives and regulation to divert waste from landfill and to encourage recycling. In his Budget in March this year my right honourable friend the Chancellor of the Exchequer announced a substantially higher and faster rate of increase for the landfill tax escalator, which is to rise by £8 per tonne per year until at least 2010-2011. Partly as a result we now expect to see levels of commercial and industrial waste falling by 20 per cent by 2010 compared with 2004. We are considering with the construction industry a target to halve the amount of construction waste going to landfill by 2012. A number of European countries have imposed landfill bans on particular types of waste. Subject to additional analysis, we intend to consult on further restrictions on the landfilling of biodegradable waste or of recyclable materials."This strategy empowers local authorities to make the right decisions for local circumstances in consultation with their local populations. However, they are currently banned from providing financial incentives for waste reduction and recycling, even though elsewhere in Europe this has been an important contributory factor to higher recycling rates. We do not believe a new tax-raising power for local authorities is the right way forward. However, in response to calls from the Local Government Association, I am launching today a public consultation on proposals to allow revenue-neutral financial incentive schemes to reduce and recycle waste. Local authorities will be able to decide whether or not to develop schemes that reward in cash people who reduce waste and recycle at the expense of those who do not. Good recycling facilities need to be the foundation of such schemes and any authority introducing such a scheme will have to provide a good kerbside recycling service, as well as take steps to tackle fly-tipping and avoid unfair impacts on disadvantaged groups. In the end it is for voters at local elections to pass judgment on such schemes as against the alternatives. "We are confident enough of the measures we are putting forward to set new and higher national targets for recycling, composting and recovery of household and municipal waste. We intend to achieve at least a 50 per cent average household recycling rate by 2020 as compared with the rate of 27 per cent in 2005-06. Subject to further analysis, we will be proposing higher recycling targets for packaging for the period beyond 2008. The Government must play their part, so the central government estate has targets to reduce waste by 25 per cent and recycle75 per cent by 2020. "We expect the combined impact of our policies to be a reduction in global greenhouse gas emissions from waste management of at least 9.3 million tonnes of carbon dioxide equivalent per year by 2020 compared with 2006. This is equivalent to taking 3 million cars off the road. These savings are before allowing for the additional carbon benefits from waste prevention."Action on waste can make an important contribution to tackling climate change and other environmental objectives. More and more people are concerned about living in a throwaway culture. This strategy gives people the tools to make a difference. It makes environmental sense and economic sense, and I commend it to the House".
	My Lords, that concludes the Statement.

Baroness Byford: My Lords, I thank the Minister for repeating the Statement made earlier today in another place, and for providing us with the four documents that go with it. Slightly tongue in cheek, I should like to ask how much they cost to produce and about the amount of paper used, but I do not expect answers to those questions today. The Minister indicates that I will get an answer; that is fine. Clearly this is a big undertaking and I am grateful for it.
	We welcome much in the Statement and it would be churlish of me not to start by saying so. It is good that we are encouraging individuals to see a way forward in how to help in saving waste, and I particularly welcome the action to deal with junk mail. Many of us are fed up to the back teeth with the amount of unwanted post that drops through our letter boxes. I was glad to learn also that there will be easier access to recycling bins, through a set of clear measures. I congratulate the Government on that. But I am sure that the Minister cannot be anything but disappointed that our recycling rate is running at only 27 per cent. Some 75 per cent of household waste still goes into landfill, compared with 38 per cent in France and just 20 per cent in Germany.
	The first waste strategy was launched back in 2000 and marked the start of things, but we do not seem to have progressed very quickly from there. Following that came the EU changes to the method for disposing of CFCs. Regulations were passed in 2000, but two years later there were still no specialist recycling facilities in the UK. Millions of fridges were stockpiled at a clear-up cost of some £40 million. This was followed by the waste electronics and electrical equipment directive which was due to come into force in August 2004. Five consultations and three-and-a-half years later, I understand that it will actually start on 1 July 2007. Then came the vehicle end-of-life regulations. What success did the Government have with those? Two million cars were scrapped, but only 762,776 certificates of destruction were issued some three years after the regulations became mandatory. Given that dismal record, is the Minister confident that the Government will meet the landfill directive, which requires the UK to reduce its biodegradable municipal waste sent to landfill to 75 per cent of the 1995 level by 2010? Can he also comment on the report from the National Audit Office last year which concluded that reductions in the proportion of biodegradable waste sent to landfill have been offset by the growth in the amount of waste produced? Clearly, that is worrying. The NAO report also predicted that local authorities would overshoot their targets by more than a quarter of a million tonnes in 2010, and by 1.4 million tonnes by 2013. That could result in the UK being fined £180 million.
	The Statement today is full of aspiration, much of which I support, as I do the consultations taking place. But I am concerned about the long-term nature of some of these targets. Will the Government consider bringing in interim targets at certain stages to ensure that they are on course to achieve their longer-term aims?
	I have six questions for the Minister. First, the Statement has announced today the voluntary agreement within industry to reduce waste and increase recycling. Do the Government have any idea how quickly this may be achieved, or whether a target has been set? Secondly, the EU packaging directive review has shown that member states can take more effective enforcement action against excessive packaging. How is this to be done? Will a European standard be brought forward or will each member state have the flexibility to act on recommendations?
	Thirdly, I turn to investment in infrastructure. We are looking forward to the PFI enhanced capital allowances, but can the Minister confirm what I was told the other day, that in fact no public money will be made available? In other words, the Government are looking to industry to deal with it themselves. What he has said does not quite tie in with what was saidby his right honourable friend earlier today, who stated:
	"We intend to support a variety of energy recovery technologies".
	The two statements do not agree.
	I turn now to the question of anaerobic digesters, a matter I raised recently during a debate. Again, I understand that no government money will be put towards developing this in the form of grants or any other help. How can we ensure that waste—an issue about which I know the noble Lord and I are concerned—is used more usefully in order to gain an energy supply from it? This is a double-edged sword: we have waste we do not want that could supplythe energy we need. Surely the two could be tied together.
	Fifthly, I turn to incentives and regulation. As I have said, the targets are long term. The Minister spoke of local government flexibility within those. I presume that neither he nor the Government wish to see any increase in the level of council tax in order to cope with the new waste regulations. What do the Government have in mind in order to help families on lower incomes? Often they are larger households which produce more waste. It is just one of those things. Lastly, I turn to the issue of fly tipping. The Statement refers to more effective enforcement, but how is that to be achieved when so few prosecutions are brought at this time?
	I thank the Minister for his usual courtesy.

Lord Redesdale: My Lords, I, too, thank the Minister for repeating the Statement. It is slightly ironic that the smell in the Chamber is coming from the treatment of waste water from the Barry Room. I thought I would share that once I found out what it was. The timing of the Statement is excellent. Being a Thursday, it is recycling day in Islington. This morning before breakfast, I put out the recycling bags and our waste food box for recycling. Islington runs a brown box scheme—in other areas they are green boxes—allowing all food waste to be transferred to larger boxes and taken away. I hope that the Minister will look carefully at taking this kind of scheme out to all areas of the country, especially speaking as someone with small children who tend to leave their food if you cannot get it down them.
	Collecting waste food has a dual benefit. First, we know that the waste is going to be used profitably for compost, and, secondly it keeps all the other waste free of contamination so that the bin bags do not smell. That will help a great deal if we move to a biweekly waste management regime with pest control, rats being a problem in London. A recent report stated that in this country we waste around3.3 million tonnes of food. What mechanisms will the Government help local authorities to implement in order to compel people to use waste food schemes? While I and many of our neighbours are doing so, other people find it just too much of a bother to put something into one container and then into another one outside. It is so much easier just to throw it intoa plastic bag, even given the environmental consequences of doing that.
	A second strand of the Statement referred to unaddressed mail. The amount of unaddressed mail that people have to deal with and which goes straight into the recycling bin is an issue which is close to my heart and, no doubt, close to the hearts of many noble Lords. However, I was quite surprised when I asked the local postman in Northumberland about this and he told me that the Post Office makes a deal of money out of the unaddressed mail market. So, combined with the issues of post office closures and local postmen in rural areas, the Government may have to address this matter because it could have a consequence.
	Are the Government planning to bring forward legislation to give local authorities greater powers and incentives? Many of us who deal with local authorities know that although the directive brought in in 2000 has been a success and should be lauded for its achievement in moving councils to recycle a good deal more of their reusable waste, there are cost implications for local authorities. The best place for recycling is in local communities at the lowest level, but there will be cost implications. Will this issue be considered in the spending review so that any further costs can be met? It could lead to cut backs in this area if the costs go straight onto the council tax and then have to vie for priority with other issues.
	As to infrastructure, the Government have referred to the importance of using food waste and biodegradable waste for biogas, which can then be used for energy or for composting. But there are very few plants recycling plastic in this country and it is far cheaper to send it to China, to export the waste abroad, than to do anything about it here. So, if we are worried about the carbon implications of this, we should start building the infrastructure, not only for plastic but for all recyclables, in this country rather than moving the problem overseas. There is a real issue in retaining the confidence of people who recycle. Many people feel that by dividing their waste and putting it in the right receptacles, they are helping the environment but a lot of them have heard stories that much of this waste goes to landfill. This has been the case with some councils which have not had the facilities and have sent divided waste to landfill. I hope the Minister will launch a campaign of information about what happens with our waste.

Lord Rooker: My Lords, on that last point, we have repeatedly said in answer to Questions in the House that it is illegal for local authorities to send waste abroad for disposal in landfill. There is no argument about that. I am not saying that it does not happen despite the great deal of checking that takes place, but it is an illegal practice. They all know that and so ignorance is no excuse.
	I am grateful for the response to the paper. I do not want to make a petty point, but the positive contribution of the noble Baroness contrasted enormously with the response made in the other place to the Secretary of State, which was negative in the extreme. We do not expect everyone to agree with everything, but the language used was inflammatory and extremely negative. The noble Baroness has been quite positive.
	The cost of the documents provided today is about £40,000. I shall write to the noble Baroness about that. We have restricted distribution of the hard copies of the full document. We have distributed only 30 to the Printed Paper Office and to the Vote Office in the other place, but they are all available on the web. If there is any trouble, my office will facilitatethe e-mailing of them to noble Lords. I recommend the executive summary, which runs to only a few pages but answers virtually all of the questions that have been raised, and the consultation paper on the incentives for household recycling. I shall refer to that in greater detail in a moment.
	The noble Baroness and the noble Lord both referred to junk mail. I do not want to open up wounds for the Post Office, but delivering 350 million items of unaddressed junk mail is an unacceptable way for it to earn a living these days. I can remember the scandal last year when it suspended a postie who had told his customers how they could stop unaddressed junk mail. I followed his advice and, although it is very difficult, it is possible to do so. We are going to make it easier to stop the unaddressed junk mail—it is quite easy to stop the addressed junk mail—but the Post Office should hang its head in shame over that postie who was suspended from his duties. I think I have made the point there.
	As to a negative part of the noble Baroness's contribution, we are disappointed that we recycled only 27 per cent of our waste; it is appalling. In the documents one can see what is done in other countries. But it was only 7.5 per cent 10 years ago, so there has been a quadrupling in recycling in the past 10 years. We are way behind virtually every other country of the original 15 members of the European Union. We have greatly misused our land and we need to increase that 27 per cent of recycled waste to our target of 50 per cent as quickly as possible. I shall not go over the past, the fridges or the WEEE directive. I fully accept the points the noble Baroness has made and that they are important in their own way.
	The noble Baroness referred to the targets being long term. I draw her attention to the executive summary on targets at page 11. The first target is set for 2010 and we are now in 2007, so they are not all long term. The targets dates are 2010, 2015 and 2020. The noble Baroness is right that we have actively to manage them on a year-by-year basis. It is no good going to sleep for a few years and asking, "How have we done?". That will not be effective.
	The noble Baroness asked about EU packaging and my honourable friend Ben Bradshaw, the Minister with detailed responsibility, contacting the Commission. The idea is to get the process Europe-wide. We need to have as level a playing field as possible with packaging because of our massive inter-trade within the community. It would not be cost effective for suppliers to have different packaging for different countries. Nevertheless, I am absolutely certain that we need a European-wide answer on this.
	The noble Baroness referred to infrastructure, the PFI, capital allowances and support for anaerobic digestion and she equated support with money. The usual phrase is: "We need support. We need assistance"; in other words, "Will the Government give us money?". If the Government can help to create a market—this is where the public good of the Government comes in—for entrepreneurs to make a lot of money out of recycling, eliminating waste and getting energy out of waste, that would be much more productive than providing subsidies. But the noble Baroness is right that comparisons will be made. The 3,000 anaerobic digestion plants on German farms are there because of a 20-year tax break by the German Government to the farmers. I am not denying that. Anaerobic digestion is fine and I am a big supporter of it. I first came across it when I was in Northern Ireland as a Minister, and there it was a very important project. There are projects all around the country, including a big one at Bedfordia and the experimental plant at Ludlow.
	As to the smaller anaerobic digestion plants and the creation of electricity, they have to be connected to the grid. We have to make sure that we do not make it impossible for groups of farmers or others using the food waste to connect to the grid, which is quite an expensive operation.
	As to incentives for local authorities, I suggest that noble Lords look at pages 16 to 19 of the consultation document. There is no single solution. Local authorities have a menu to choose from of bin volume-based schemes, frequency-based schemes, sack-based schemes—that is, buying the sacks—or weight-based schemes. Example one is on page 19, example 2 is on page 20 and example 3 is on page 21. This shows exactly how such schemes can work, with cash coming back to people who have recycled more than the norm and payments being made by those who have not bothered to co-operate, either because they have to pay for a higher volume of waste to be removed or, if it is a sack-based scheme, they have had to buy more sacks. The issue of fines does not come into it. If you recycle and dispose of less than the norm, you will gain financially. That is the exercise here. A separate financial arrangement will be made with regard to council tax. That is an important point. There will be no knock-on to the council tax; it will operate quite separately. In this country, we do not allow our local authorities to give such incentives, but other countries do. We will have to legislate for that, and I understand there will be an opportunity, as they say, in forthcoming legislation.
	With regard to fly-tipping, I can only reinforce what was said during the original exchange at Question Time. Incidentally, local councils will not be able to bring in those incentive schemes unless they have developed kerbside recycling for at least five products and been proactive on fly-tipping. In other words, whatever the local populace might say, they cannot just come in and say, "We're going to have this incentive scheme where you pay a bit more or a bit less". All the infrastructure must also be in place to make it easy for people to dispose of products and to be proactive so that there will not be any increase in fly-tipping. Rather, the authorities must actively operate against it. A package is therefore laid out to make it revenue-neutral and as positive for customers as possible.

Lord Rooker: My Lords, the answer to the first part of my noble friend's question is yes. On the other part, I am no expert on the nuclear issue, but I have noted a somewhat hysterical view on the disposal of nuclear waste given as an excuse by certain people not even to debate the use of nuclear power. Disposing of and safely looking after nuclear waste can be put to bed from an engineering and technology point of view. That remove the hysterics which are stopping people even having the debate on nuclear.

Lord Marlesford: My Lords, I congratulate the Government on a package that contains some pretty good stuff. Not for the first time, I wish the noble Lord were in line command of the whole thing, because he is robust and practical and I suspect he would get things done.
	I am a little surprised that there is no mention of the highly successful approach in the United States of making containers—tins, glass and plastic bottles—returnable. It started over 20 years ago in Oregon, and has now spread to a number of states. The net result is that if the affluent discard things, the less affluent pick them up and get some money from the shops when they return them. Of course that adds to the cost initially, but the cost of packaging, includingits environmental impact, has to be paid by the consumer, and should be.
	On fly-tipping, I should like to put on the record suggestions I made to the Minister after the exchange in the House two or three weeks ago: a mandatory sentence for conviction for fly-tipping, not of a fine and certainly not of imprisonment, but, for the first offence, of 50 hours of litter-picking, and of100 hours for subsequent offences. I doubt whether many people would commit more than once offence.

Lord Inglewood: rose to call attention to the state of the countryside and to the provision of public services in rural areas; and to move for Papers.
	My Lords, now that the Minister has stopped talking rubbish, I am delighted to call attention to the state of the countryside and the provision of public services in rural areas. In doing so, I declare myriad interests: financial and emotional, past and present, direct and indirect. They are in the Register of Members' Interests, and I leave it to your Lordships to decide whether I am simply an advocate of self-serving self-interest or whether I know a little bit of what I am talking about. I must explain that I both enjoy and am interested in cities. In the remarks that I am about to make, I shall be quite deliberately general.
	I think that it was about nine months ago that I was asked by a Member of your Lordships' House to attend a dinner of the Hansard Society. We spoke about a number of things, including, inter alia, the problems associated with the common agricultural policy. I dropped in the remark that I thought that whatever else happens, one must have some sortof policy for farming and the countryside. My interlocutor, who was a Member of the other place, on the opposite Benches from me, looked absolutely blank. That was a terrible indictment, because in the countryside and rural Britain, we are talking about80 to 90 per cent of the surface area of the country. One cannot simply abandon it. If one does, it leads to dereliction, and there is nothing more expensive to put right than that. If one looks at the amount of money that has been spent in inner-city areas since the war, it makes what has been spent on the countryside pale into insignificance.
	Against that background, what is needed? There are three parts to this: first, we need a good policy; secondly, we need sound means of delivering that policy; and, thirdly, we will require social measures as appropriate to deal with some of the problems that are left. When one thinks about the countryside and those who live in it, it is important to make one distinction: between the many people who are living and working in the countryside with the benefit of money that has been earned and made elsewhere and the second section of the rural community—perhaps I may call it "indigenous"—which is living and working in a low-wage, low-wealth-creating part of the economy. They are the people on whom we should be concentrating in our remarks today.
	In thinking about the countryside, one has to start with agriculture and forestry, because, even if they are not the biggest economic sector in large parts of rural Britain, they are nevertheless at the heart of it. Certainly, in my own home area of Cumbria, tourism is worth more money to the community than agriculture, but when there is no agriculture, there is no tourism.
	When thinking about farming and agriculture, one has to remember also that we have a common agricultural policy. I should have thought that it is a policy that no one in this Chamber, or anywhere, would invent from scratch, but it is what we have and we have to work with it. Moreover, it is getting better. It is an improvement that we do not now find that we are paying for public goods through a mechanism which is coupled with production. However, the policy fails. It fails the test contained in the Treaty of Rome which states inter alia that one of purposes of the common agricultural policy is to ensure a fair standard of living for the agriculture community, in particular by increasing the individual earnings of persons engaged in agriculture. It also fails the test of fair trade, which, as I said to the noble Lord, Lord Truscott, at Question Time about a fortnight ago, is a principle that also lies at the heart of domestic agricultural policy.
	I am afraid that some of this will be old ground for the Minister, but the real immediate problem is the collapse of the delivery system of the policy that we have. Of course, the Minister himself is not as an individual directly responsible for that. However, as the Minister standing at the Dispatch Box, the buck stops with him. The sins of the father are being visited on the son. I pay tribute to the Minister, as my noble friend Lord Marlesford did. I was talking to one his colleagues on the Benches opposite the other day who said, "What a marvellous Minister he is—he gets away with murder week after week". But he need not worry about the reshuffle because, if my experience and that of my noble friend is anything to go by, the Government will not pay any attention to anything we think.
	What has happened as a result of this is that infection has spread through the department. I know of an instance when, despite having had the proper information for two years, it is simply not possible to get hold of the proper digital map. The public are entitled to expect competent delivery of public policy, but is it happening? No. The European Commission, in agreeing to the form of the common agricultural policy in this country, will expect it to be delivered effectively. Is that happening? No, it is not. Finally, those directly affected in their livelihoods by the system, for better or worse, whatever the details of the policy, are entitled to a degree of competence in its delivery. It is not happening. We have a course of systemic maladministration.
	As I and other noble Lords will have heard the Minister say, the system that we have for delivering the single farm payment in England is intellectually superior to the model employed in the other home countries. I concur with that. The problem is that we have been too clever by half—it is as simple as that. As I have said before, in the department it is a case of lions being led by donkeys. But it goes wider than the straightforward agricultural problem. All the other public goods coming through agricultural policy, such as environmental activities, climate change issues, landscape considerations and as a framework for tourism are all affected as a consequence.
	When I look back to the Second World War, I believe that one of the great mistakes made in this country was in the thinking inherent in the 1949 planning legislation. The vision of the future was that the countryside would be for agriculture and forestry and almost every other activity was going to take place in the built-up areas. That historically had never been the case, but the effect has been to see an elimination from the countryside of all kinds of industrial, semi-industrial and commercial activities, which had traditionally been there. Now, as the world has moved on, we are trying to see—and I think rightly—a shift back. One problem that we face in this regard is that much of the move back is in practice being driven by the rural development agencies, which are essentially emanations of central government. They are the contemporary successors of Oliver Cromwell's rule of the Major Generals. We know that the underlying framework in which they were originally conceived has not come into being because of a change of tack in regional policy, but it is a problem for those intended as the beneficiaries of the policy that it has been delivered in a very corporate and dirigiste way.
	The other difficulty that is damaging the impact of the move back is that we are always looking for a bolt-on series of social outcomes, which in turn are getting in the way of getting things done on the ground. I also make a plea for the Country Land and Business Association's proposal that in its treatment of rural activities it should look at the revenue from the perspective of rural business use. That would make it infinitely easier for those who are business people in the countryside to diversify their activities. That contrasts with the market-driven approach that we adopted in government, in things like the enterprise zones and the initiatives of my noble friend Lord Heseltine. When public money is involved we need to pump-prime businesses which of their own volition and with their own energy will then become sustainable. That is crucial; we must have a light touch. What we must not do is micro-manage.
	With services in the countryside, we would all agree that we want equivalence between the town and country and rich and poor. Things cannot be identical: some things are going to be more expensive and some cheaper, depending on where one is. That is why things like calculations about sparsity are so important—and my local authority, Eden District Council, felt very hard done by in that regard. Post offices, public transport and hospitals are networks; each relate to the other. Public transport is self-evidently important with regard to hospitals and post offices. If everyone has a post office within three miles of them, for example, it is fine; but if you are 80 years old, it also matters whether there is public transport. Where I lived as a child, if you wanted to go to Carlisle by bus you could go on a Tuesday but you could not get back until the following Friday, which was not very helpful.
	When you are thinking about hospitals it is important to realise that it is not only the patient who is important, but also his family—both sides of the equation. People want to see their families and friends if the latter are ill, just as the people who are ill want to see their families and friends to be encouraged by them. What you cannot do is salami cut pieces off networks because that goes to the very heart of the network itself.
	I should like to spend a moment of two talking about housing. Much earlier in my life I had the good fortune to be on what was then called the Lake District Special Planning Board. I became aware of the housing problems of local people, or affordable housing as it is rather unattractively known. I have been interested in and concerned about that for a long time. One of the mistakes we have made in this country in looking at this has been to try to look at it too much from the demand side and not enough from the supply side. The thing that strikes me very forcefully in the Lake District is not the shortage of houses but the shortage of houses that can satisfy the particular needs which need filling. As the Minister may know, I have talked to his colleague, the noble Baroness, Lady Andrews, about this. In a world where owner occupation is becoming increasingly accepted as a norm, we must try to find ways to put conditions on existing houses—what I might call second-hand houses—so that they remain available for people who are normally perceived as falling within the scope of affordable housing. We ought to be much more imaginative in looking at vehicles such as building preservation trusts. I know that the Government are working on shared equity. In the longer run there is much more advantage in trying to unlock the problem through utilising existing houses than through building more and more new houses, which over time only marginally reduces the price of second homes.
	As regards letting, we must try to find ways of getting existing housing stock into the hands of forms of social landlords. I am president of the Lakeland Housing Trust, a very small charity, which has been doing this now for 70 years on its own terms. It is run by professional volunteers—a tradition which goes back originally to Mrs Rawnsley, the wife of Canon Rawnsley who founded the National Trust. If you keep the organisation small and local you can do a lot of good.
	As a person who is active in public life, I always keep an eye on the party political weathervane. I ask the Minister to cast his mind back to a memory which I should think is rather happier for him than it is for me; namely, the general election of 1997. It struck me then that for the first time in my adult life the Labour Party had made real inroads into the rural vote. But since then—I cannot say that I am entirely unhappy about this but it is a concern—it seems to me that it has lost an awful lot of support. Part of that was caused by the foot and mouth outbreak and part of it was to do with the hunting ban. Not everybody likes hunting. I have never hunted to hounds with a horse although I have done a bit of fell hunting in the Lake District. Whatever the rights and wrongs of the legislation, it seems to me that the argument behind the change in the law has not commanded the hearts and minds of much of the rural population. The only argument that they really understand that is left is a metaphysical one—that somehow it is wrong to hunt foxes with hounds. Yet in almost every other aspect of contemporary life we are being told to be tolerant and that we must understand and accept other people's way of doing things. Country people ask, "Why have we been singled out to be treated differently?"
	Country people are tolerant, albeit they are often politically incorrect. It is very important to understand that because if people feel generally unwanted, unloved and on the defensive, they will become alienated. With alienation there is a risk of fragmentation in society. We have seen in Scotland how that is beginning to put tension on the union. In the north of England my party has had problems because apparently real Northerners do not vote Tory. We have seen problems and pressures and stresses and strains in the immigrant communities. I am not the only one who has noticed this. On the countryside march an apparently respectable young man was handing out newspapers, but when you looked at the bottom of them you found the imprint of the British National Party.
	Some years ago I went to the annual Asian Businessmen's Dinner in Blackburn organised by the noble Lord, Lord Patel of Blackburn, shortly after a BNP breakthrough. One of my hosts told me that he understood why people vote for the BNP. He said, "They need it more than we do. We get all that is on offer".
	If we are trying to take this country forward in a one-nation way, we need to have everyone bound into that. If that does not happen, and people do not get a fair crack at the whip, we will get fragmentation. There is a real risk of that in the countryside. I beg to move for Papers.

Lord Livsey of Talgarth: My Lords, I thank the noble Lord, Lord Inglewood, for initiating this debate, which I regard as extremely important, even though it is on a Thursday before we break up for the Recess. It is an interesting topic:
	"the state of the countryside and ... the provision of public services in rural areas".
	I will try to analyse how one assesses the state of the countryside at present. First, it is connected withthe quality and sustainability of the environment. Secondly, it is to do with the economic viability of rural communities, and that includes the state of agriculture, to which the noble Lord referred. Thirdly, it is about the social cohesion of rural communities and, fourthly, it is related to the availability of rural services, both public and private, which are provided by local councils, the development agencies, transport networks, private enterprise and the voluntary sector, which in some rural areas plays a very important part.
	The quality of the environment seriously deteriorated in the 40 years between 1960 and 2000. Since then, there is no doubt that environmental schemes have kicked in, such as the planting of deciduous trees, river clean-ups, hedge reinstatement, CAP farm environmental support schemes, set-aside and many other issues, which have improved, over the past five or six years in particular, the quality of the environment. We have had a huge loss, which is seen most acutely in our rivers and streams. Ecological damage has reduced fish life, and crayfish is practically unknown these days. Fly life in freshwaters has declined, and industrial pollution has played its part, as has run-off from agricultural land, pesticides, sheep dip and so on. The Environment Agency is addressing many of those problems, but there is much more acute awareness than there used to be of the insidiousness of some of those chemicals. We used to get grants for drainage, and now we have rivers with half the summer flow that they used to have. There must be some relationship between the two, and that has to be put right.
	We are changing our forestry from soft wood to more hard wood, and that needs to accelerate. The impact of climate change is accelerating, and it is already overtaking many of those developments. In 2006, in the area that I live in, central Wales, we got70 per cent of the average rainfall of the previous20 years. In April 2007, only a month or so ago, we had only 1 per cent of our normal rainfall for April. Those are very serious matters.
	Is the countryside sustainable to withstand climate change? My answer would be, "Not yet". We must, for example, monitor the water table, which in many rural areas has a serious deficit. This week's EFRA Select Committee report on the Government's vision for the CAP, which I have here, is a constructive analysis of the future of CAP reform, and it provides some of the answers. For example, before any attempt is made to abandon by 2013 Pillar 1 of the CAP, which is basically single farm payments, the Treasury must, in conjunction with the EU, provide certainty. The EFRA committee report states:
	"The only long-term justification for future expenditure of taxpayers' money in the agricultural sector is the provision of ... public 'goods'—environmental, rural, social—it wishes to enjoy".
	This philosophy must be backed by hard cash to produce a sustainable rural policy. It is no good attacking Pillar 1 if you do not have a proper Pillar 2 for the CAP that can concentrate on rural development. The record is not good. Just over a year ago the British Government lobbied the EU presidency to reduce Pillar 2. I know that money was in short supply, but that was not the right way to go about it.
	The economic viability of many rural communities is seriously in decline. Shops, post offices, even pubs and garages have closed without replacement. Small farms have vanished and some 2,500 post offices are now threatened with closure. They should not be closed, but converted into community resource centres for business start-ups, information technology and innovation, and there should be initiatives in marketing co-operatives for the community, community regeneration and promotion of tourism. If the post offices are to be closed, the buildings should be used for something that would benefit the communities.
	Our rural areas need assistance, training and capital for young entrepreneurs. For example, it would be helpful if younger people could receive business rate discounts for business start-ups. Agriculture and local food production must be incentivised to produce greater self-sufficiency, as must the outlets for it. On social cohesion, the demography of many rural communities has been stood on its head. There are far too many older people compared with the young. The demise of council housing is of particular regret to me, because I was brought up next to a large council estate, which in those days contained families with 10, 12 or 14 children. One such child was Geoff Lewis, the jockey who won the Derby on Mill Reef. He was in my school form; good luck to him.
	The sale of those council houses has been a disaster for the demography of our rural areas. We need affordable homes, and councils must be able, not necessarily as providers, to allocate land, initiate shared equity schemes and provide houses to rent for younger members of the community. Councils usedto be able to provide for much more measured communities in terms of age. Younger families lived in many of the houses and the village schools automatically stayed open because there were many children. That very much needs to be encouraged.
	We need to concentrate on many issues of this kind, because we must be positive about rural areas. At present, not enough resources are provided to support them.

The Earl of Erroll: My Lords, I thank the noble Lord, Lord Inglewood, for providing an opportunity to debate this matter. Instead of starting with my usual tirade against the Rural Payments Agency, I shall consider other people in the countryside and other issues.
	Everyone seems to think in terms of the urban proletariat and the country peasant, or whatever, but there is a huge mix of people in the countryside. Who will use these rural services? There is a mixture of old people, young people, some very well paid executives and some poor people. Their main common characteristic is that they are more spread out than in towns, which gives rise to infrastructure problems. Some commute to cities and towns, others work locally, but they probably need to commute for some distance in some way.
	What is our objective as government in the broadest sense in looking at this? Is it administrative efficiency or are we trying to create the right environment for people to live there? I refer not only to the environment at the Natural England end of the spectrum but also to the infrastructure and how that affects people who live and work in the countryside.
	One characteristic of people being more spread out is that they end up driving more because there is no easy method of getting from A to B using public transport. It is probably totally uneconomical to provide widespread public transport in rural areas because, nowadays, people have more freedom of choice. Unless we go back to having a centrally controlled, Communist-style authoritarian Government who say, "You will work there and do it efficiently", people will criss-cross all over the place. So individual transport solutions will be required, certainly for the local links.
	People commute and the ideal solution is to get them to use public transport, such as trains, when travelling longer distances. However, one problem there is capacity. In many areas, trains are already operating well over capacity. For example, in the north, it all comes down to two tracks that run over a big viaduct—it may be the Watford viaduct. There is a limit to how much that can be expanded. Then you have to leave your local form of transport at the station, because it is likely that on the way back a bus will not run from the station to get you home at the end of the day.
	You can probably predict how you will get to where you are going but you cannot always predict when your work will end. Therefore, you take your car, but where are you going to leave it? If you leave it in a side street, the neighbours get very cross because there are never enough parking spaces. The spaces that are available are overpriced, because parking is privatised and a profit has to be made. No one is looking at the problem globally and asking what the greater benefit entails. Perhaps we should provide free parking, as happens in Biggleswade, to stop people parking outside other people's houses and to encourage them to travel by train.
	It is all very well giving pensioners free bus passes, but that is not much good if there are no buses available when they want to travel. I am not sure that that is viable. I remember the African taxis running around Nigeria and Kenya. They were Peugeots that held about nine passengers, and people piled in and out all over the place. It was all very entrepreneurial, but that would never be allowed here. It would be considered too risky on health and safety grounds; the Department for Transport would say that it could not be done; and someone else would point out the insurance consequences of running such a business. We are so regulated that it is impossible to do anything to tackle most of these problems.
	Then there is the question of distances—for example, how far is the nearest hospital or post office? The post office is not just somewhere to post letters. You can now download stamps from the internet. You just print them out, stick them on your letters and post them. We can obtain a lot of things without visiting the post office, but in the countryside post offices are part of the social infrastructure and social environment. When the departments said, "I can deliver my departmental silo more efficiently by doing something else", no one thought to say on behalf of UK plc, "You have nibbled away at all the bits of the thing that we really wanted to keep—the post office—until it is no longer viable". That was a huge mistake. No one had the guts to say to all the departmental silos, "Sorry, there is a bigger social issue here, so don't all go off and do your own thing". Anyway, it is too late now, and I do not know what we are going to do about it. It is a terribly sad situation and I think that there will be huge social costs and social services costs as a result.
	Then we get to the towns, where people have been packed in efficiently. A lot of rubbish is generated because the Food Standards Agency insists that the supermarkets wrap items to a certain standard. Whether people like it or not, they have to take home a lot of waste, but we do not want them to put it in their bins, so we charge them by the amount they dispose of. Therefore, we have a problem. What will you do if you live in a council house in the middle of a town and you have too much rubbish? You will put it into a plastic bag, which will be banned by then, and take it to the nearest bit of the countryside and heave it over a hedge. At that point, it becomes the responsibility of the local farmer or someone else to clear it up.
	Of course, that farmer may not have registered an exemption for that type of rubbish under the new waste regulations because it is someone else's rubbish and, unless he has permission to move it and has registered an exemption to do so, some other agency will come along and fine him. That may seem a ridiculous statement but it is the sort of thinking that goes on and an example of the confrontational approach between those who live in, and try to manage, the countryside and those who try to tell them what to do.
	Some of the people who commute to London by train are highly paid executives. When people make lots of money, they like to get away from the towns and buy somewhere out in the countryside. Some young people in the countryside also want to start up local businesses, and rely on a critical local infrastructure. Lots of people think about critical national infrastructure for broadband and communications, but we need to get high-speed services out, reliably, all over the countryside. There are huge EU finds for this: look at what Barcelona is doing. Are we doing it? No, it goes through an RDA. I do not know; I am trying to find out how you get the paperwork together to put a business case to the RDA to get EU money—which is sitting there, waiting for us to apply for it—to get some mesh radio, wireless or other technologies across the countryside, allowing people to work from home rather than commute into London the whole time. You get a green benefit from that, because people are sitting at home or working in a local office instead of having to commute to a population centre.
	This comes down to people: the sort of people who stay in the country and live and work there, such as farmers. I know a little about farmers because I married one—that is my declaration of interest. The average farmer farms because they hate paperwork. What are we doing now? We are making them farm paperwork. No longer can they use their judgment about anything. Everything is process-driven. It is not a factory out there; you do not know what the weather is going to be like or if the season is going to be early. You know that if you do not cut your hedges for three years, they will get leggy and the English partridge, a biodiversity action species, will bewiped out trying to nest under them. But the environmentalists do not know that, so they want you to grow your hedges tall for some other songbird. It is all balance and judgment, and you must work it out.
	You now need quite a seriously high education standard to fill in all these forms. What are we going to do with all the people who live in the country who do not want to be educated to that standard? Presumably they have their 10 per cent adult illiteracy rate like everyone else. How do you deal with deadlines when you are ill? The real problems come with the confrontational approach of the RPA and others. Instead of ringing up and saying that there is a 0.4 discrepancy—to which the response would be, "Oh God. I am sorry, I wrote 0.7 and not 0.3, but the net area is correct"—they say "We are going to fine you if we can under the penalties in section P", when you know that they do not even have the right to do so. It is the wrong approach; it leads to mistakes, confrontation and disaster. I leave noble Lords with that thought.

The Lord Bishop of Chester: My Lords, I welcome this debate. Britain is a relatively crowded country, and the state of our country areas is a vital subject for town and countryside dwellers alike. The great majority of our people who live in urban areas value the contrasting amenities that the countryside provides, and those who live in the countryside easily feel the pressure of nearby urban areas. The countryside itself has changed greatly with the impact of technology, leading to fewer people working on the land and fewer who do so being directly employed.
	The Diocese of Chester, from which I come, contains both the broad swathe of rural Cheshire and the continuous industrial band on the south side of the Mersey, from Birkenhead through Warrington to Stockport, so I see both sides. I shall indicate the areas of concern that I hear from the more rural areas. In doing so, and notwithstanding the hiatus over the single farm payments, I pay tribute to how Defra has sought to develop a proper strategy for rural areas with the White Paper in 2000, which was followed so swiftly by the foot and mouth epidemic and the rural recession. That made the national planning process rather difficult.
	I begin with the recession itself. Agricultural recessions tend to be long and deep because of the general inflexibility involved in working the land. Falling prices put inefficient producers out of business, and the assets are often taken over by more efficient producers. That tends to exacerbate the problem of overproduction, depressing prices even more. With a bit of luck and judgment, arable farmers can switch crops, but livestock farmers are less able to make such changes, especially in the dairy industry, which is prominent in Cheshire, with its large capital investment in milking equipment and herds. The price of milk has been at a disastrously low level in recent years—below the level of production in many cases—and the present recovery in other areas of agriculture has not yet had much impact on that. Many dairy farmers have simply given up. Only this week, we heard the news that Her Majesty the Queen's pedigree herd of Ayrshires at Windsor is to be sold.
	Those farmers who remain do so under considerable pressure. One farmer's wife said to me recently at her son's confirmation, "It was always hard work, but now it's even harder work for hardly any return". With the isolation that comes from working with fewer colleagues, one can understand the growth of stress-related problems and the tragedy of suicide in the farming community. In Cheshire, the churches acting ecumenically have gathered together to employ an additional full-time agricultural chaplain to provide pastoral support and encouragement to farmers in these circumstances. Some farmers have diversified—rightly so—and sought other income streams. In Cheshire, with large urban populations nearby, that has been relatively possible, but it can be only part of the solution and brings its own distortions to rural life.
	I shall say a word about the environmental issue of trees. Partly due to the general recession in agriculture in recent years, farmers have tended to neglect the wider issues of stewardship even more than before, unless a direct economic incentive has been offered. As one drives around, most of the trees ones sees in hedgerows are relatively mature and are often dead or dying. Imagine the countryside with trees largely confined to defined woods and coppices or plantations. I wonder whether more should be done to encourage individual tree planting, largely for aesthetic reasons. One needs a long-term vision for that to succeed. It takes decades for most trees to grow to a decent height, and the best trees take many decades. In today's society, we sometimes simply prefer schemes with a shorter-term impact.
	Tree planting is also an underdeveloped theme in responding to climate change. The Stern report told us that the worldwide increase in carbon dioxidein the atmosphere is as much due to ongoing deforestation as to transport, which is an astonishing fact. Across the world, we need to promote an ethos of reafforestation. While an individual tree counts for relatively little in that, an imaginative programme of tree planting across our countryside would be symbolically very important. Beyond its aesthetic value, it would symbolise the wider commitments that we rightly seek to make at the present time.
	I shall turn briefly to the role and place of the churches in the countryside, in relation to the provision of rural and local services in particular. A recent research study, helpfully supported by Defra, into the contribution of faith bodies to rural communities identified five local facilities that are of particular importance to rural people: the village hall, the pub, the primary school, the shop and the church. In some interesting developments, country churches have been exploring a role in supporting some of these other facilities, although we have not yet opened a church and pub as a dual-purpose entity—maybe that will come. The Millennium Commission, using lottery money, gave substantial grants to enable churches to convert space, usually at the back of the church, into a flexible meeting area with a kitchenette, toilets and so forth. That has proved to be an extremely creative and effective in my diocese and beyond. Churches elsewhere have provided space for farmers' markets—we are just about at the 10th anniversary of the first farmers' market in the modern era—visiting post offices and visiting advice centres that deal with a range of matters. This is one of the ways in which we must respond to the closure of permanent post offices.
	Provided that the primary purpose of a church as a place of worship is safeguarded, I entirely welcome these Dibleyesque developments. A church has to seek to take a place at the heart of its community and be ready to adapt to the needs of that community. Churches always used to be like that; it is very much a Victorian and modern development to think that they can be used for strictly religious purposes only. Indeed, the legal framework surrounding the use of churches is now loosening to respond to these new opportunities.
	Finally, I shall say a word about planning issues, which are again coming to the forefront of the Government's attention. Much has been said about the need for affordable housing, and there has been real progress on that front, but it is a long-term issue and is vital to the health of rural communities. There must be no let-up in seeking to establish a broad range of affordable housing in our rural areas. We have tended to have highly restrictive planning policies, with a good deal of artificiality accompanying them; for example, barn conversions often have very artificial outcomes.
	The countryside needs people. I often think that our villages would benefit from a slightly more open planning regime. In that regard, I welcome the prospect of more taxing of planning gains, provided that the gains are used for social purposes. It could be seen as though, rather like the fields and the hedgerows with which I began, everything is a bit too stuck in the past, or at least in the status quo, in some of our villages. There is a need to trust local people more in the decisions over their own lives and their local area. Overall, I am not too pessimistic. I see a lot of resilience and determination in the rural communities that I know to meet the challenges that lie ahead.

The Duke of Montrose: My Lords, like many others who have spoken, I feel that rural areas have changed in many aspects over the past decade. The council houses have been sold off, the agricultural workers have largely disappeared and the rural people have kept the bank manager happy by selling off houses to more wealthy people from the towns, usually older people or those wishing for second homes. The local young have found that there is limited opportunity and less housing, and so the older generation is left behind.
	The current crisis in the dairy industry, alluded to by the right reverent Prelate the Bishop of Chester, has meant that more than 2,000 dairy farms have closed down since 2002. That is more than one a day. The latest information is that, in 2006, at less than £14,000 per annum, one in three farmers is living below the Government's low-income threshold. In Scotland's less favoured areas, the average income was published as £8,400. That, along with the deluge of regulations, causes a worry for all those who wish to stay in rural areas and in agricultural production.
	Fortunately, or unfortunately, agriculture is coming to fulfil a role as a rural service, and the support systems are geared to providing a public benefit. As my noble friend Lord Inglewood was hinting, the single farm payment in England has been a nightmare for all concerned, compared with what I and others have experienced north of the Border. Rather than trying to introduce new mapping requirements at the start, the Scottish Environment and Rural Affairs Department is now carrying out its inspections and, as here, checking field boundaries by satellite. I was lucky: it found that I had underclaimed by 0.4 per cent and so did not earn a penalty. Unlike the 220,000 farmers in England who are still waiting, in Scotland almost all the payments have gone out on time.
	The great idea on which the single farm payment was sold to the industry was that it would be a great simplification and would mean that fewer pieces of paper would need to be submitted to the Government if you wanted to keep the business afloat. What has happened is that you have to fill out what appears to be 10 times the amount of computer and paper records to comply with all the requirements. These are required to be kept for anything up to 10 years. It has been a fairly radical shift for those who considered themselves to be the horny-handed sons of soil to find that several hours a day has to be spent in administration and that Jack of all trades has to be accompanied by Jill of all regulations, or some other person, all rolled into one.
	Until recent years, as noble Lords are aware, farming and forestry provided employment, stability, an appealing countryside and the basis for rural communities. This Government have a great passion for going out on their own in the hope that they can get other countries to follow. They are now trying to achieve some of these aspects through what is called "voluntary modulation" of up to 14 per cent of the support available to farmers. That must be looked on with amazement by most of the 26 other member states from their offices in Brussels that do not want to go down that road. The money is due to be channelled back through the devolved Administrations and the England Rural Development Programme.
	In order to benefit, farmers will be required to look to and provide new and different aspects of land management. The effect of these measures in more remote areas is rapidly revealing itself. I must admit to being more familiar with the situation in Scotland, although I am sure that the same must be reflected in many of the communities that we are considering today.
	In a period of seven years, the breeding flock of sheep in Scotland has reduced by 70,000—or 20 per cent—and the number of farms by 10 per cent, to the extent that the Royal Society of Edinburgh has just instituted an inquiry into the future of the hill and island areas. At the same time, the Scottish Executive has commissioned an inquiry into crofting and its system of land tenure. The puzzle is: what sort of environmental management can you have once the farmers leave? Can the money be accessed to the same effective extent by a community made up of bed-and-breakfast owners—not that I have anything against bed-and-breakfast owners? Are studies being carried out on similar situations in England? What is the Government's attitude to the problem?
	Another issue that is very much to the fore at the moment is the implementation of the European directive on nitrate-vulnerable zones. It is somewhat reassuring to hear that the new water director in Defra is questioning to what extent the rules that have been envisaged as full compliance are really necessary and how much is likely to be gold-plating of a rule that has been redefined in translation. I am told that the present understanding is that the whole policyis predicated on the 15 millilitre drinking water standard, when many of the rivers affected are not used for drinking water. It would be interesting to know how long the sampling regime on which the selection of rivers has been based has gone on, and whether account has been taken of the conditions in the 1980s and 1990s, when fertilisers were much cheaper and farmers were much more profligate with their materials. Is the current situation really as worrying as the records would lead one to believe?
	The regulations will cause most disruption in limiting the seasons for the spreading of manures. In any western and high-rainfall areas, to which the noble Lord, Lord Livsey, referred, that will require huge extension to storage capacity and will severely restrict the few existing opportunities to get out on the land without causing damage. In Scotland, the Executive propose to bring in the full rigour of the rules. The Scottish Environment Protection Agency, which is known under the acronym of SEPA, has been given the title "Screw Every Penny out of Agriculture". In one survey undertaken by NFU Scotland, 11 of the 16 respondents said that they would give up farming if that level of control was introduced. We hope that Defra will arrive at a better solution.
	The brave new world that is coming into shape in the countryside combines biodiversity, wind farms, biofuels, broadband and tourism—all ways offered to bring an economic rationale and employment to rural areas—but it will still need the basic care and maintenance of the resource to make it a place that is pleasing to the eye and in which we can all take satisfaction.

Lord Roberts of Llandudno: My Lords, much attention has been paid to the role of agriculture. I shall speak about a different type of countryside. I shall contrast it from the beginning. When we look at the problems in our cities and our larger conurbations, we see that we need to return to a community feel and a community structure where people feel that they belong to one another and have responsibilities to one another—to build a sort of family within our cities. We already have that family in our rural communities. The tragedy is that so many of our actions today are undermining those communities and the relationships within them.
	It is not wholly fictional, but I think of a village called Llareggub Bach. I thought of making it Llareggub Minor, but in Wales you would only get that in Gwent; in my part of Wales, it would be Little Llareggub. It is not fictional. I know of the places that I am speaking of. It used to have a good population of quarrymen and agricultural workers, but the quarry closed about 40 years ago. Then the quarrymen and their families had to move out. I was there on the Sunday after the quarry closed and they were packing, ready to leave that area. There are far fewer agricultural workers today than there were 40 years ago. Then the wool mill closed, so everything that sustained that particular community now belongs to the past.
	One then has the problem of what one does with the various community institutions. The right reverend Prelate spoke of the role of the church. In the part of Wales that I am speaking about—it might be Llareggub Bach—there were nine places of worship; in Wales, we believe in doing things wholeheartedly. All but one closed one after the other. The one that remains is attended by between 10 and 20 people on a Sunday evening. Not only have the buildings gone, but so has the vicar, as well as the two nonconformist ministers. These were the people who kept that community together.
	There were two schools in the village at one time; one in the upper valley, the other in the lower valley. One closed some years ago and the other is struggling to meet the targets necessary to make it viable for the children of today. The schoolmistress does not live in the village, nor does the assistant or the nursery assistant. The doctor will come if someone is ill, but the village has no surgery. The policeman will occasionally call in a panda car—if they still call them that—to see what is going in the village, but the crime rate is pretty low so we do not see the policeman very often. The policeman does not walk around the village and hear the gossip of the people, so he does not really know what is going on or know the people in that area.
	The village has become desolate, remote and isolated. There was a time when we had 39 shops in the village. My uncle ran the post office there. It was a busy post office, but now that has gone. People say, "If you want your pension, you can go to the bank". The bank used to come on a Friday morning, but it does not come any longer. If you tell the pensioners that they can get banking online, they ask what online means and what a website is. We must travel to another village or town some miles away to get our pensions, car tax or television licence. None of those things is available in the village any more. This was once a viable community.
	So much that we are doing in villages today is undermining their viability. The scheme to close 2,500 largely rural post offices will destroy communities. We must somehow get to grips with this. We have community support officers. They are not the same thing that I am thinking of, but could we not have some sort of support for rural communities? People could go into villages and help with the parish or community council, which might find it difficult to get a clerk or a treasurer. The band has gone, ashas the choir; very few local organisations are left. There should be some organisation that could come in and help the organisations that remain. I do not know whether we are now at crisis point and need a royal commission on the countryside to look at the massive changes that have taken place and are taking place. We should remember that if we lose rural communities, or indeed any communities, we are adding to our problems in the years ahead.

Lord Cameron of Dillington: My Lords, I, too, shall talk about the delivery of rural services. The first thing that I shall do is stamp on the heresy, which seems to be prevalent, that rural communities have less need of public services because they are on average slightly more affluent than urban ones. An even worse mantra doing the rounds says that if people choose to live in rural areas, they should expect worse public services. Frankly, that is disgraceful. The poor of the countryside have not chosen to live there; they are almost certainly born there. They live and work there among their family and friends, and probably contribute enormously to their rural community. They could not possibly move to the towns, in any case. Such a mantra is equivalent to saying to the people of, say, Hackney, "Your health and education services are not very good, but we the Government are not going to do anything about that, because, frankly, why don't you move to Canterbury or Reading?". It is exactly the same idea. That is a very bad starting place, which I have heard in government and Civil Service circles.
	It goes without saying that services cost more to deliver to rural areas, which is fairly obvious. Refuse collection in rural areas costs 70 per cent to 90 per cent more than in urban areas because there is more distance between the bins. Therefore, more fuel is required and the three or four people on the lorry require more time. A recent report indicated that primary school education per head in remote rural areas costs 24 per cent more than in urban areas. Of course it does: there have to be more buildings and more heads so that the very young do not have to travel an excessive distance to their first school. At the other end of the scale, domiciliary care for elderly adults costs an extra 5 per cent if they receive one visit a week, up to 163 per cent more if they have five visits a week, and so on and so forth.
	In highlighting the problems of rural communities, I do not want to deny that the most deprived urban areas face profound problems of poverty and social exclusion. I do not even deny that they should have additional resources. But it has been brought to my attention by Professor Asthana of Plymouth University that the focus on area-based initiatives, notably the Neighbourhood Renewal Fund, and the tendency for mainstream funding now being targeted by area-based deprivation indicators means that the problems of disadvantaged people not living in disadvantaged areas—for example, rural people—are largely being ignored. If the Government truly wish to target poverty and social exclusion they must realise that more deprived people live outside deprived areas than live in them. It is a somewhat sobering thought that this year the London Borough of Islington, which I have always thought of as a fairly mixed community, will receive more from the Neighbourhood Renewal Fund alone than the total budget of many rural district councils.
	To my mind, the funding allocation for health in England has gone very wrong. In my response to last November's Queen's Speech I drew your Lordships' attention to the fact that the allocation of NHS budgets makes no real allowance for the extra costs of rural delivery. A recent NAO report has pointed out that to deliver out-of-hours cover costs 70 per cent more in rural areas than in urban ones. This, combined with the extra cost of having more health centres, more transport costs, training and even extra housing for staff explains why, for instance, in Scotland rurality adjustments have been made to the funding formula, with some rural areas receiving more than 30 per cent extra. However, in England it is the other way around. The primary care trusts serving the most urban populations receive the highest average per capita funding, whereas PCTs in rural areas receive the lowest.
	In addition to these points, Professor Asthana and those assisting her argue that in the health sector the really critical issue is the relative importance given to age in the calculation of funding. She cites the example of Manchester, which has a much higher standardised mortality ratio than east Devon. Very loosely speaking, in layman's terms, a standardised mortality ratio means that the people of Manchester have a lower life expectancy than the people of east Devon. Thus, the interpretation is that Manchester is perceived to have greater health needs, whereas the reality is very different. Manchester has a much lower proportion of people aged more than 65 than east Devon; that is, 13 per cent compared with 27 per cent. Of course, older people make far higher demands on the health service than the young, owing to the degenerative illnesses of the elderly. It is not surprising that a greater percentage of the east Devon population died in 2003 compared with Manchester—proportionately, one and a half times more. Therefore, although Manchester has a much higher standardised mortality ratio, a smaller percentage of its population requires the very expensive, high-intensity care associated with proximity to death.
	All those facts explain why in 2004-05, 3 per cent of PCTs serving urban areas failed to break even while 68 per cent of PCTs serving populations in rural England ended the year in deficit. Noble Lords will recall that these PCTs respectively receive the highest and the lowest per capita funding allocation. Takinga more common newspaper headline, it is not surprising to find that the average waiting time for an inpatient appointment at Caradon in Cornwall in 2004-05 was 145 days compared with around 54 days in Hackney. So those residents do not have to move after all.
	As health funding continues to shift towards deprived areas, there is a real danger that by the end of the current funding round we will have two National Health Services, one predominantly urban that is increasingly well resourced, while the other serving rural England becomes ever more hard-pressed and struggles to adjust to lower levels of per capita funding. One has to ask whether this is compatible with social justice and equity for the rural poor.
	The health sector is just one good example of what is happening in other areas. Local government funding is also strongly weighted for area deprivation. As a result, London boroughs and metropolitan areas receive two to three times the amount per head as shire counties. For instance, twice more London pensioners receive home care than those in rural counties. At the other end of the age spectrum, while I know that Sure Start has tried hard to rural-proof its activities, it still does not reach out to most of the three and four year-olds living in poverty in rural areas. There also seems to be some sort of postcode lottery provision for pupils with special educational needs.
	I do not have all the answers, but one thing is clear: we must find a better way to assess and respond to the needs of all our population. Rather than using complex geographical formulae which rather dubiously suggest that there is only real need where there is mass deprivation, why can we not set eligibility and assessment criteria on a national basis and ensure that the needy and disadvantaged are protected irrespective of where they live?

Lord Dear: My Lords, I declare interests as a member of both the Countryside Alliance and of the British Association for Shooting and Conservation, and as a trustee of the Country Trust, a charity which introduces children from deprived inner-city areas into the life and workings of the country.
	The truth is that probably only during the Great War and the Second World War has this nation really valued its own countryside and has the rural economy flourished. From behind the plethora of soft-focus television nature programmes, quite recently the truth was finally exposed in a programme called "The Lie of the Land", brilliantly presented by Molly Dineen, which graphically portrayed the plight of modern dairy farming.
	There remains a massive ignorance and even a lack of interest in the problems of rural areas. As social conditions change, so, too, of course, will farming and country life. But if that way of life is not to be destroyed by harsh and unfair policies and economics, an infrastructure of rural services is vital to its survival. For that reason I congratulate the noble Lord, Lord Inglewood, on securing this debate and I am grateful for the opportunity to participate.
	Rural services are a crucial component of life in rural areas, particularly in the more remote regions. Those services should provide a network that sustains and consolidates the community. They are, in effect, the reinforcing rods of rural life, without whichthe whole edifice will come tumbling down. Yet metropolitan areas receive on average 20 per cent more SSA—standard spending assessment—funding per capita than rural areas, and in rural areas council taxes are higher for a lower level of public services.
	Staying with the generality, the sparsity of rural communities, which has already been mentioned several times in the debate, in comparison to urban ones puts them at a further disadvantage in any comparison of per capita public investment. For example, a single urban police station may be able to protect 100,000 people within a five-minute call-out time. In a rural area, that same number of people will be very widely dispersed and it will probably take40 minutes or so to reach them. The point of the example is that many forms of services in rural areas require far greater per capita investment to provide anything like an equivalent service to that given in an urban community. At present, investment for rural people per capita is invariably lower.
	Today I want to touch on only two issues that affect rural life, transport and retail outlets. I shall not go into the current vexed question of the closure of post offices. First, I shall use some statistics, in much the same way as has been done already to great effect by the noble Lord, Lord Cameron of Dillington. Seventy per cent of rural parishes do not have a general store. Four thousand rural banks have closed in the past 10 years, and another 4,000 are expected to close in the next five years—a decline of one-quarter. Some 53 per cent of all rural settlements do not have a public house. Around 8,500 independent grocery stores have closed within the past five years, most of them in rural areas.
	The causes for such a seismic and rapid change are of course conjectural, but I suggest that the effects are partly due to domestic migration. First of all there is the immigration into an area by the retired, the wealthy and second-homeowners, all of whom can well afford to travel to the nearest town and shop in bigger retail outlets. Second-homeowners, as I often observe in my own village, often spend little or nothing locally but bring all that they need with them from the city, where it is cheaper. To arrive with a box of groceries and a full tank of petrol is commonplace. Secondly, there is the emigration out by the young for education and employment. That changes the overall demographic base, which in turn is bound to affect trading patterns.
	I turn to rural transport, which is perhaps even more important. The first point to make here is that transport infrastructure needs to be created with reference to the social and economic needs of the local areas, not simply around the needs of visitors to the area. Given the paucity of rural services and facilities and the dispersed nature that exists, a significant minority of residents, especially those without a car, face real hardship and social exclusion. Car ownership and use in rural areas is high: 40 per cent of rural households have two or more cars, and three-quarters of all their journeys are made by car. For the 16 per cent of rural residents who do not have a car at all, however, hardship is acute.
	National indicators of deprivation used by the Government are urban-based. They do not always reflect the picture in rural areas, and they can distort the reality. For example, current indicators of deprivation include car ownership as a measure of wealth, but in rural areas that is not appropriate when many poor families are forced to own a car to enable them to travel. Rural residents travel on average 40 per cent further than urban residents each week, because facilities and services are likely to be further away. That is because 75 per cent of villages do not have a daily bus service. Rural motorists drive further to buy their petrol, because 600 filling stations are closing each year and the closures are leaving some households in rural areas 30 miles or more away from their filling stations. When eventually they get there, they are necessarily charged more for fuel because rural prices are higher.
	What can be done? Local authorities could and should undertake accessibility planning to examine what access different communities have to a range of services. Local transport plans should consider the potential for bringing services to rural settlements, as well as looking for improved public transport. There is a need for more flexibility for the type of transport that is provided for more responsive services, such as bespoke minibus routes, for individuals in remote areas. Providers of healthcare and other services also need to pay more attention to the needs of rural areas. This is an important issue, going to the heart of many of the current problems. Appropriate planning of transport schemes in rural areas can rejuvenate communities and provide an essential lifeline. The obverse of that coin is that without it, communities will fail.
	Not all the examples I have cited are the responsibility of Government—of course not. Many are the result of market forces. But we all have a responsibility to ensure that the rural way of life and the rural economy is not allowed to wither by default, a responsibility to see that one of this country's most prized assets continues as a vibrant way of life; and a responsibility to ensure that the emigration to the towns does not cause irreparable damage.

Lord Redesdale: My Lords, one of the great joys of winding up a debate is being able to throw away half your notes when you agree with a previous speaker and do not have to cover the same ground. The noble Lord, Lord Dear, spoke about immigration and emigration to the countryside through second homes. We will see that tomorrow, with the great clogging of the roads as everybody disappears to their second home for half-term, and London will be emptied.
	One of the problems with this debate is the cornucopia of issues on problems in rural society. We can direct many of them at the noble Lord, Lord Rooker, who I am sure will give a forthright and direct response, as always. It would be easy to say that many of the problems in rural society are the result of government mismanagement, when instead they are down to simple economics—wealth creation, people in cities moving to the countryside and the fact that much of the primary production of agriculture and the price of produce is being driven down by the supermarkets.
	Another problem is that such a small minority of the population lives in the countryside. The 2001 census showed that only 19 per cent of the population lives in the countryside. Many of the rural services are in decline because of the shrinkage in the number of people living in the local area. I was looking through local village historical records. At one time, more than 200 children from Rochester and the surrounding area turned up for the local picnic. Five years ago, there was only one child of school age in the same village. It is a simple problem which has been exacerbated by the fact that the property price is based on second home ownership prices rather than local need or income. In addition, there has been an influx of older people; as people become older and lose the use of their vehicle, they have major problems. In an area such as mine, which is one of the remotest parts of the country, you need a car to get around. If you cannot, you have to sell your house and move to somewhere which has better access to local services.
	Many noble Lords pointed out that the countryside has many problems. There is great wealth in the countryside too, and very vibrant communities. To paint a picture of depression and economic hardship would be wrong, but the problem is hidden. I have worked with young people from YMCAs in Yeovil and other parts of the country who paint a picture which is very close to the urban situation faced by their contemporaries—homelessness, drug abuse and lack of access to social services. But because their numbers are fewer and they are spread out over larger areas, the problem is largely hidden.
	I was particularly taken with the speech of the right reverend Prelate the Bishop of Chester and his wonderful Dibleyesque view of the church. With the ordination of women and the number of women vicars we have in Northumberland, there has been a great resurgence of interest in the Church of England. Our local church was packed at Christmas carol time—not at all other times of the year, of course—but it showed the value of all the churches in rural areas as a social amenity. I very much welcome the work that the Church is undertaking, especially with regard to suicide in the agricultural community. Farmers have one of the highest rates of suicide of any profession in the country. This must be due not just to economic hardship but also to the fact that the industrialisation and mechanisation of farming have meant that it is possible to maintain only one, perhaps two, people in work on a farm, thereby making it a very isolated existence.
	The Minister will be glad to hear that I have only two questions for him. I left them until last, thinking that I would then sit down and give other speakers extra minutes. The first is about squirrels, which the Minister knew I could not avoid. As the noble Lord, Lord Inglewood, initiated the debate, it would be wrong of me not to raise the issue. I run the Red Squirrel Protection Partnership, which is trying to kill grey squirrels to protect red squirrels, but that is not the issue. We have recently come across a problem that is affecting a large number of wildlife trusts and those who are trying to conserve different species of animals. With the formation of Natural England and the new grant schemes, it is almost impossible to raise money for a single, easy objective of protecting a particular species without having to fit it in with a multiple approach in the grant regime. One has to fit it in, for example, with tourism or agriculture. If one fails to do that, to fit a square peg into a round hole, one has real difficulties. Will the department undertake some research? I know that many wildlife trusts and many of those who are attempting to conserve single species of animal are having a problem. It is a growing problem which, if it is not resolved, will within a couple of years do a great deal of damage to conservation in this country.
	The second question relates to the provision of health services in rural areas. I could make an extremely long speech about that. The issue was brought home to me by the problems faced by a friend who had difficulty with her pregnancy. I live on the border with Scotland. As it was a difficult pregnancy, the ambulance in which she was travelling was diverted from Hexham, 26 miles away. She was told that she would have to wait until they could find her a bed either in Newcastle, Darlington or Sunderland. That is an enormous distance to travel, especially given the situation that she was in. I understand from the NHS that the provision of excellent, centralised care can help, especially in urban areas, to prevent many complications. The problem is that this policy of centralisation is being led by those people who live in urban areas and does not take into account the travel time required to reach those centralised systems. I shall present the Minister with a paper entitled, Ensuring Equitable Access to Health and Social Care for Rural and Remote Communities, which was written by a team of experts in rural health. It outlines some of the problems. I hope that his department will feed back to the NHS some of the difficulties that rural communities have identified. It is a cross-departmental issue that should be looked at.

Baroness Byford: My Lords, this debate, initiated by the noble Lord, Lord Inglewood, has reflected its participants' great knowledge of the difficulties and opportunities faced by those who live in rural areas. I congratulate him on securing it at the eleventh hour before we leave for a week's break.
	Much as I would like to spend quite a bit of the time available to me speaking on farming and farming-related matters—I should again remind the House of my family farming background and interest—those issues have been well covered by colleagues. I should like to touch on them further but this debate goes wider than agriculture and deals with the state of the countryside and the way things are today.
	I have to say to my noble friend Lord Lucas that I do not think that any of us is calling for extra subsidies. We are reflecting that as things currently stand, rural people are disadvantaged in the system, in local and national government spending across the public services, including policing, health provision, housing, medical facilities, IT infrastructure, transport and schools. The 2004 report by SPARSE—the Sparsity Partnership for Authorities Delivering Rural Services—highlighted the disparity between council tax rates and the delivery of local services in rural England. Metropolitan areas receive 20 per cent more on their SSA than do rural areas, while rural areas have fewer public services to enjoy.
	There have been ongoing reductions in the availability of key services such as banks, job centres, petrol stations and pubs, to say nothing of post offices. Last week we had it confirmed that another 2,500 post offices will be compulsorily closed, and others may close as well. Perhaps the Minister will tell us how many of the 2,500 compulsory closures are in rural areas. Last week I asked how many of those 4,000 free ATM units will be fitted in rural areas but I did not get an answer.
	The Federation of Small Businesses estimates that approximately 26,000 of its members are based in rural wards. Its research demonstrates that despite the important role that small businesses play in the rural economy, poor delivery of service support remains the key barrier to growth. In his review, the noble Lord, Lord Haskins, concluded that too many government agencies are involved in delivering services to the countryside and that there is a lack of co-ordination between them.
	Farming is a business like any other business and it depends on local services. Industry has gone through major changes, moving from a system of food subsidies to one of highly defined environmental requirements. The change has had a major impact on many farmers, but it is Defra's failure to achieve delivery of the new payments on time that has been catastrophic. Many noble Lords have referred to that. Some 22,000 single farm payments for 2005 are still in dispute and those farmers are worse off now than they were a year ago. That was confirmed by the Minister last week. The situation is unlikely to improve for them until 2008. I hope that we hear something slightly more positive in his response today.
	My noble friend the Duke of Montrose spoke particularly of farming issues and issues related to hill-farming. Clearly many farmers leave the hillside, and their future needs specific consideration. Other noble Lords referred to systematic maladministration—and I shall not add to that. In the past few years since Defra was formed, 750 general and local statutory instruments have been introduced. I asked last week how many had been updated and how many revoked and the Minister told me in a Written Answer that the department,
	"does not have a central database of revoked regulations or which identifies those that are updated regulations, and collation of the data requested would involve disproportionate cost".—[Official Report, 15/5/07; col. WA20.]
	I trust the Minister—which will be my folly at some stage. If these promises of deregulation and outcomes cannot be resolved, there is no way in which we can hold the Government to account, and that needs addressing.
	We have heard many Statements this week, and we have heard that the Government intend to amend the planning laws to enable householders to put up porches and greenhouses, erect wind turbines and install solar panels without formal permission. That is good news. However, I am concerned that some big national projects will be approved of only by the new planning permission that has been set up, which is another unelected quango with responsibility for major development.
	Living in the countryside is many people's seventh heaven. When one is in full possession of one's faculties and has sufficient earning capacity, it is indeed that. However, as we have heard, if one is elderly, ill or earning below the average wage, one can often feel that it is more like the other place—and I do not mean the Commons. The decline in government support for the rapidly rising cost of disability, nursing, care homes, day centres and adult learning has hit those living in the countryside the hardest. Indeed, as the noble Lord, Lord Cameron, said, the fact that you may have been born in the countryside does not help. That is where you were born and where you have lived; you have not moved there.
	Infants and toddlers do not need much outside the home but society demands that they should be vaccinated and counsels medical help with most ailments. Unfortunately, there are fewer and fewer single GP practices and the groups tend to put themselves in centres of population. Therefore, the rural mum has to take her youngster to town and pay to park on the street, if she can find somewhere to park.
	As rural children grow up, only a few are able to attend a school within walking distance. That means their parents are faced with an extra dilemma. Should they let them walk or will they take them to school by car? After school comes higher education. For the rural family that means more transport. As we heard, bus services are often inadequate and the result is often a choice between acquiring a car for the young person or seeing them move away. In my opinion that is to be regretted because people from one age group are migrating to the countryside while young people are leaving. One of the biggest problems for young people trying to find a job in rural areas is that of housing, as other noble Lords said. Broadband is another key factor in the ability of young people to get jobs in such areas.
	Most villages levy a parish precept—this has not been mentioned so far—on top of the universal council charges to fund the work of the parish council, which includes litter removal, street lighting and grass cutting. The precept rises depending on the size of the village, but a rate of £1 per week for a band D house is fairly common. This amounts to a large extra cost by the end of someone's lifetime.
	I draw the Minister's attention to page 85 of the departmental report which highlights certain issues. There is slippage against the rural productivity and services public service agreement target, mainly because Defra does not have the levers to ensure delivery. Secondly, there is a significant lag in gathering data to monitor progress on Defra's rural PSA target. Thirdly, the Commission for Rural Communities has expressed concern over the availability of data to enable government departments to report the rural impact of policy decisions. I urge the Minister to respond to that.

Lord Rooker: My Lords, I start by quoting a speech on this issue made some time ago:
	"Villages should be vibrant communities with a variety and richness equal to those in our urban villages. They should not be pushed into single-class pieces of detached suburbia surrounded by fields. Fewer than one in 10 now have a bank, a pharmacy or a permanent library ... On health matters, I cite the joint survey last year by the Maternity Alliance and the National Federation of Women's Institutes, which found that pregnant women in rural areas face restricted choice, hospital closures and long journeys to clinics ... It is clear that the closure of local shops, and particularly of post offices, which are little used by wealthier rural dwellers, is most likely to hit those on low incomes. Fewer than one third of the rural population use local shops, but a survey commissioned a few years ago by the Department of the Environment found that those who did were the poorest".—[Official Report, Commons, 5/4/1990; cols. 1392-93.]
	That was a flavour of the speech that I made on5 April 1990 in a debate that I initiated in the other place. I gave all the problems and not the answers. I freely admit that I have refreshed my memory on that. It is my undying credential that as an urban person—not now so much; far from it—in 1990 I was concerned that those issues needed to be raised. Things have improved in some ways, but in other ways they have just got worse. As the noble Lord, Lord Dear, said, it is the force of economics and society that have made those changes. What you do not use, you lose. It is not always the case that local people are in control.
	I will break the habit of a lifetime in this House by saying to noble Lords that I will ask officials to prepare a letter for me covering the points that I do not answer today. I know that a lot of work is involved in a Minister making that commitment, but with the range of issues raised today there is no way I can do justice to what noble Lords have said. I will briefly respond to some of the detailed points. I have a standard government text here, which does not say that everything is fine and dandy, but it gives a flavour of the changes in recent years.
	It is true that, if one takes a survey, one finds that most people living in the countryside would prefer to do so and many people living in the cities would prefer to live in the countryside. There is no question about that. Some people are trapped in one and some are trapped in the other. The forces of economics and our electoral system mean that sometimes their voices are not heard. In the inner cities, some votes are taken for granted, and in rural areas other votes are taken for granted, which means that there is a group in both areas that is not listened to. There are some serious issues here, and change is going on all the while. I will attempt to respond to some of the points that have been raised in the debate, rather than give the standard government spiel, and I will respond to other points in a letter afterwards.
	The noble Lord, Lord Inglewood, said that he was making a general speech as an introduction to the debate. It is important to set the scene. He talked about agriculture and forestry and he mentioned the RDAs. He also made the point, which has been a flavour through a lot of speeches, that this is not about a single factor; it is about a connection. The post offices, hospitals and transport are all inter-related. You might be okay for one, but if you do not have the other you have a problem. Therefore, you have to look at it as a whole.
	The noble Lord rightly raised the point about housing for local people. There are detailed programmes for restrictions for new build for affordable housing that mean that the housing has to be passed on to local people and cannot go out into the market. It is a serious issue, and many people have taken account of that. When I was at ODPM, I was at a meeting called by the Duke of Westminster at his base. He summoned every landowner in the country at 10 o'clock on a Monday morning to read the riot act about releasing small bits of land for half a dozen developments here and half a dozen there—not big developments—because the vibrancy of the villages needs to be maintained. That is serious and there are programmes. I pay tribute to the CLA and all the others involved.
	I am not going down this route, but the noble Lord, Lord Inglewood, made the point about hearts and minds. He touched on a point about the impression given from 1997 about what happened afterwards in the handling of foot and mouth and hunting. Perhaps I was elected in 1997 in favour of the ban, but before I got here I changed my mind anyway, born out of my experience in MAFF. It is as simple as that. It was a question of oppressiveness and not giving enough local choice, but that is another story.
	The noble Lord, Lord Livsey, talked about post offices and about local food. Later this year there will be the launch of the year of food and farming. I hope that that can be used by industry—it is industry-led but Government-supported across several departments—to try to make the connections between the production and provenance of food, linking up the areas where the food is produced and where most of it is consumed, which by definition will be in urban areas.
	The noble Earl, Lord Erroll, started off by saying that he would keep away from the RPA, and I was very grateful for that, although the noble Baroness, Lady Byford, came back to it at the end. I will not be able to go down that road today. My regrets and apologies if the noble Earl thinks that he has come across what he thinks is a confrontational issue. I get distressed about rigid adherence to some of the EU regulations, and sometimes I have to adjudicate on some of the appeals. The panel says one thing and the lawyers say that one cannot accept the panel. On one or two recent occasions, we have been confrontationally oppressive and I am seeking to have the decisions changed. There is rigidity in the system, which should be loosened up to take account of people's personal and sometimes tragic circumstances.
	I think that we can overcome what the noble Earl said about waste and fly-tipping from the cities. I certainly hope that we can, given what was said earlier today, by planning to be proactive about it. He also mentioned broadband, as did someone else. I am a bit concerned, because I need to ensure that we have got this right: my information is that the availability of broadband in the UK is now 99.7 per cent, with rural coverage at 98.6 per cent. I shall check whether that refers to geography or people—I assume that it is people—but that figure is substantial and, frankly, if there are problems in specific areas I would like to know about them. As a Minister, when I am given those kinds of figures, I have to ask: where is the problem for the vast majority of the country?
	The right reverend Prelate the Bishop of Chester made several points and I understand what he said regarding foot and mouth and the fact that the livestock sector has a worse time than the arable sector. The county of Cheshire has 20 per cent of our milking herd, so it is incredibly important for our dairy industry.
	The right reverend Prelate mentioned something that struck a chord, because I found it in my brief. When I read it, I thought, "I haven't heard of this". I asked about it yesterday—the Pub is the Hub scheme. It relates to the demise of public houses. There are approximately 50,000 in England, of which 15,000 are in rural areas. In the past five years, 300 pubs nationally have been transformed to include a wide range of facilities, including—wait for it—gyms, post offices, school dinners, bakeries, church services and pharmacy collection points. That is as a result ofthe Pub is the Hub initiative, supported by the department. It is obviously a small scratch on the surface, but there is an attempt to realise the use of the pub as the hub of the community to ensure that, with the changes in society, we can make use of these facilities—whether they are pharmacies or whatever. The churches have different rules about what type of pubs people can go into. As a former Methodist Boys' Brigade boy I realise that there is a problem in some areas. I shall not go down that road, but noble Lords will appreciate my point.
	I should tell the noble Duke, the Duke of Montrose, that, while I speak for the Government, I do not speak for Scotland. I appreciate that there is a difference between the single farm payments for Scotland and England. He mentioned nitrate-sensitive zones and the fact that one of the directors at Defra has been raising that issue. I assure the noble Duke that that director is not the only person who has been challenging some of the assertions about covering the whole country with nitrate-sensitive zones. We are in negotiations with Brussels. I have to say that we have a Rottweiler, who is supposed to be there to deregulate not to regulate. He may be called the director of regulation, but I look at it the other way around. His instinct is to go for minimum regulation and I encourage him in that.
	The issue of the closed period and the amount of storage is very serious—there is no question about that. We do not want to poison the water. No one wants to do that and I have never found a farmer who wants to poison the streams. To listen to some people, you would think that all farmers want to do is poison all the streams and not bother about what they put on the land and when they put it on. Farmers obviously care about this issue, but we are governed by these regulations. We have taken such a long time to introduce them—10 years or more, I understand—that we are under threat of infraction proceedings, which is why we need to come to an arrangement with the Commission.
	The noble Lord, Lord Roberts of Llandudno, painted a picture that I recognise of villages that have closed over time. There has been no single reason for that; changes in technology and other aspects of society cause different factors to change. The rigidity of our planning laws probably does not allow new things to start up in a village to maintain its vibrancy, and you end up with exactly what I said in 1990: you get single, detached pieces of suburbia surrounded by fields. That is the direct result of the planners' rigidity in not allowing changes to buildings that have been created for one purpose and not allowing a new business to come in and flourish in order to maintain the vibrancy of a village.
	That is a serious issue but we must also take into account the fact that what you do not use, you lose. Although I do not blame anyone for it, people were moving away from collecting benefits and incomes from the post office long before the Government ever thought of going for automatic cash transfers. When I discovered that 10 per cent of people on income support were having their money paid directly into their bank, that told me that something was changing substantially. When I was at the DSS, 50 per cent of pensioners were already choosing, voluntarily and without any pressure, to be paid in that way, but when the poorest people in the country on the lowest income—means-tested income support—chose to have their income paid into the bank, that indicated that a substantial change was afoot.
	One could conceive of a situation whereby, if nothing was done to manage the post office network—at one time it consisted of 18,000 independent businesses—the lot could be lost overnight and people would wonder what had happened to it. Therefore, we have to manage the network. I obviously regret the closures but we want to maintain as many rural post offices as possible, and we have tried to get government departments to use new services in post offices.
	The situation was just as bad in rural areas. An assessment, by constituency, of who had money paid into the bank was carried out long before there was any element of compulsion, when the system was purely voluntary. People were asked how they wanted their pension or maternity benefits to be paid. To start with, income support was not available through the bank—it was available only as cash—but when people were given a choice, they moved to having payments made into the bank.

Lord Rooker: My Lords, I assure the noble Baroness that, long before the present situation, I was at the DSS headquarters in Newcastle when people were asked over the telephone how they wanted their pension to be paid. I was wearing earphones when people phoned in and, when they gave their address, the first thing to come up on the screen in front of the civil servant was information on the 10 nearest post offices, which was displayed automatically. The civil servant knew exactly which post office the pensioner would need to go to, if that was what he wanted. The people who phoned in were given choices. Obviously the situation has changed now, but then it cost 89p for an order to be paid at the post office and 1p for an automatic cash transfer. The enormous amount of fraud and benefit book theft that occurred in the post office system put pressure on the Government to adopt a more modern system. However, I repeat that people were moving away from post office payments long before the element of compulsion had a bearing. I do not blame people but that is the reality.
	I do not want to pick out particular speeches but, because of the issues raised and the positive way in which they were raised, I would have felt privileged to make those delivered by the noble Lords, Lord Cameron and Lord Dear.
	There is a real problem in balancing urban regeneration grants because they target only 10 per cent of the worst areas. Therefore, 90 per cent of those areas are not included in the Neighbourhood Renewal Fund. When I was at the ODPM, I visited what appeared to be leafy and prosperous small market towns. I shall not mention them because that would be unfair. But occasionally you see another side. I remember coming back from one such visit and saying to officials, "How on Earth can we have allowed this to happen in this place? It is as bad as any urban area I have seen in terms of unemployment, dereliction and the nature of the estate". The officials almost laughed at me. They said, "If you look at the numbers involved, you'll see that this place is listed at about number 3,000". In other words, there is not enough money. We are targeting only 10 per cent of the worst places, so we are bound to miss out both urban and rural areas.
	In addition, the calculations are made differently today. When they were made on the basis of wards and constituencies—particularly wards, as there is variation around the country—there was unfairness. Now officials use—and I am damned if I can remember what the zone is called—pockets of 3,000 people around the country to make up areas of deprivation, so they are more equal than ever before. Nevertheless, there is bound to be unfairness in the system, simply because we are targeting not 100 per cent, but only the worst 10 per cent.
	The noble Lord, Lord Dear, raised a point which struck a chord with me—and an answer came through on a note—about people living in rural areas needing more than one car, which meant that the system was unfair. He is absolutely right, but that was identified and dealt with. In fact, the index of deprivation does not have a motor car ownership issue now, simply because the noble Lord's point was identified and something was done about it. There is obviously a high dependency on rural transport.
	I think that the noble Lord, Lord Lucas, was basically calling for freedom and choice with some degree of economic independence in rural areas. He said that people there would be able to better use resources than having resources planted on them on a one-size-fits-all basis. That was the basic issue, as well as there not being enough money. It may be that the planning freedoms and some of the loosening up can assist with this. A report commissioned by me and David Miliband about barriers to diversification was put up on the department's website a couple of weeks ago, without much fuss. While it was essentially for farmers, it was very rurally focused, asking what the barriers are. The two key barriers relate to planning and business skills. The report has about 22 recommendations, and we are going to try some across government. The noble Earl, Lord Erroll, used the term "silos". We have to go "silo busting"—a jargon phrase I discovered the other day in a Foresight research programme. We must "silo bust" across government to implement planning; Defra must obviously work with other government departments on that.
	The noble Lord, Lord Redesdale, has answered a question. When I flicked through a newspaper this morning, I could not figure out why on Earth someone had done a diary piece about how many times I have mentioned the word "squirrels" in the past six months. I thought, "Blimey, someone's calculated this". It was only seven times; the noble Lord, Lord Whitty, is apparently on 200. With the reshuffle coming, the piece said, I do not have much time to make up my count of mentioning squirrels. Well, squirrels are actually very important. Red squirrels are more important than grey squirrels. I now realise why someone has been alerted to the fact that squirrels need a mention. Natural England, as noble Lords know, is supported by the House in the different bodies coming together. The point raised by the noble Lord, Lord Redesdale, was whether there was an issue with single-species wildlife trusts not being able to carry on. If that is an issue, we must clearly look at it, along with the others.
	The noble Lord raised another issue of which I am conscious. The health situation presents special challenges in relation to scarcity and transport. You cannot have a maternity unit or brain surgeon on every street corner, whether in an urban or rural area. The issue of medical facilities in rural hospitals is a constant. I could quote statistics and figures, but I will save that for the letter. On the noble Lord's example, it is quite unacceptable for women who have already been picked up in the ambulance for the driver not to know where they are going. That is absolutely unacceptable. They may have to go further than originally planned, and not to the nearest hospital—but to be picked up when the driver does not know where they are going to go is quite unacceptable in the 21st century. I will be happy to give a better response on that, I hope.
	The noble Baroness, Lady Byford, mentioned ATMs. How many of those 4,000 are going to be in rural areas is for local consultation. I do not have the figure for her, but I will come back on that. The Post Office has already started local consultations on the restructuring to determine where the subsidy is going to go. The real problem in a situation like this is controlling which offices close. Sometimes it is like voluntary redundancy where the good people go and the others have to be kept. We do not want that with the post offices. We need to keep the ones that are more vital than others. That consultation has already started.
	There is less regulation. If I were to give a block answer about statutory instruments, the numbers would look great, but we will be able to show that we are cutting back on regulation. We have a programme to do that, and we will be up before the Select Committee on the annual report to show what we are doing.
	I will have to come back on the point about the precepts on the parishes because, by definition, they are the third tier of government. One assumes that the services that the parish council is providing are not coming from the district council, therefore the district council is saving the money. It is not as though it is an extra, and it does mean more local control. It means that the parish council has a bit of control over the way it does things. It is not a great deal, but it is not simply an add-on.
	On the noble Baroness's central point about the RPA, we have paid up to 82 per cent of the money. Our target is 96.14 per cent of the money by 30 June. I explained the reasons for the delays, so I shall not go into great detail. We are going to come back to the 2005 people. It is an incredibly complicated scheme, far more complicated than it needs to be. As was said, it is more sophisticated than the others, but therein lies the problem. We are now dealing with three years' payments. We have plans that are being operated and implemented as I speak to try to achieve that target, but we need to close down 2005 and deal with 2006 as quickly as possible so that we can start to pay the money for 2007 earlier in the year than we did for the 2006 money. We paid earlier in 2006 than in 2005, but I fully admit that we are now behind where we were last year in terms of the totality of the money, although the cash-flow situation has been vastly improved, as shown by the Bank of England figures that I gave at Question Time.
	I am very grateful for this debate. It is a pity that it was only two hours, but the other debate was quite important. The business managers do the split, not me. I will make sure that I send a note on the points that I have covered inadequately or not at all. I shall send it to all noble Lords, and I shall make sure that a copy is placed in the Library.

Lord Freeman: My Lords, I speak as chairman of European Union Committee Sub-Committee B: Internal Market. I thank for their support—both speaking and moral—in this debate: the noble Lords, Lord Mitchell, Lord Dykes and Lord Lee of Trafford, and my noble friend Lady Eccles.
	The sub-committee reported through the Select Committee to the House of Lords on 23 April. I pay tribute to the retiring Clerk of the sub-committee, Duncan Sagar, who has distinguished himself in his service to Sub-Committee B. He is moving on to perhaps higher things in the Government Whips Office. He will doubtless be able to help facilitate debates on interesting reports coming from this committee in future. I also thank our special adviser, Chris Williams.
	Our report dealt with international mobile phone calls within the European Union. There has undoubtedly been market abuse over the past five years in terms of the level of charges made to consumers. It has been estimated, among others by Commissioner Reding, that the charges could have been up to four times the rate of domestic mobile phone charges. The industry has reacted to criticism over the years, but in the judgment of the committee it has not done enough. Charges have not come down fast enough.
	In the United Kingdom, and indeed in certain other nations, we regulate domestic charges, but until now there has been no method of controlling charges on an international level or within the European Union. I pay tribute to Ofcom, which is regarded within Europe as one of the better, if not the best, regulators in the telecommunications industry. However, its writ does not run to control the costs of charges coming from within the European Union back home to the United Kingdom.
	In our judgment, there is justification for the European Union authorities to act. The high level of charges is a barrier to developing effectively a single market. The charge levels affect businesses, particularly small and medium-sized enterprises. We believe that it is in the clear interests of European consumers for the European authorities to act.
	What did we propose? We proposed a wholesale cap on the rate of charges between network operators. For example, when a call emanating from Spain comes back to England, it goes through a network from Spain and perhaps through intermediate countries, back to a terminal in the United Kingdom. From thence it becomes a domestic call. The wholesale charges are presently completely without any kind of regulation. We recommended a cap of 30 eurocents per annum. That is the rate that network operators charge each other. I am glad to say that the European Parliament also came up with that figure. The presidency, under Germany for the past few months, has so far broadly supported that level of charge, and a consensus is building around it.
	We did not suggest specific retail caps; that is, a specific sum charged to both the sender and the receiver of an international mobile phone call. However, we were in favour of a safety-net tariff that limited the total cost to the consumer. We argued that there was no need for caps at the retail level because of our fear that innovation and competition would be endangered. We argued for an opt-in mechanism for existing customers of mobile phone operators being able to make specific decisions to opt-in to this safety-net tariff and for new customers automatically coming within the protection of a safety net but having the ability to opt-out.
	We also argued for sunset provisions for the regulations. I think that we were the only voice, certainly in this country and possibly in Europe, arguing for that. It is a matter for the European Parliament and the Council of Ministers under the co-decision principle, and for the Commission to implement. It is not for this Parliament to implement a regulation of international charges.
	I am glad to tell your Lordships that there has been significant progress in recent weeks. The European Parliament voted yesterday for action on this front, and I understand that the Council of Ministers has reached agreement with the European Parliament. It is due to consider the issue on 7 June. It will be the duty of Mrs Reding—a very impressive Commissioner whose views did not necessarily in their entirety commend themselves to your Lordships' committee, but we were very impressed with her energy and enthusiasm—to implement any decision agreed between the Council and Parliament.
	What are the differences between the report of your Lordships' Committee and the European consensus? We are agreed on the wholesale cap. It should be based on average charges throughout the year for different network operators, but we agree with the 30 eurocents per minute cap. Incidentally, the European Parliament has voted for a gradual decrease of that cap over three years. I welcome that, although it was not in our report. The European Parliament has voted to protect consumers with a maximum retail cap—obviously that includes the wholesale charges from the operators, but also the cost of delivering the call to the mobile phone or landline of the subscriber—of 49 eurocents per minute for an outgoing call and 29 eurocentsper minute for receiving a call. That is a total of73 eurocents. Those caps would also decrease over three years.
	Although we disagree with that approach, what we would end up with is certainly preferable to no action. Our concern with setting retail caps is that the industry might move immediately to charge the maximum, which would inhibit competition and innovation.
	I shall briefly touch on four points that may be helpful to future debate. It is a pleasure to see the noble Lord, Lord Truscott, in his place to answer the debate. He made a rapid transition from membership of European Union Sub-Committee C to ministerial duties and we thank him for taking time to come to answer this debate.
	My first point is that during the three-year uninterrupted life of the regime controlling mobile phone costs, I want the Commission to watch for the impact on competition and innovation in the industry. If we end up with everyone charging the same rate throughout Europe, that would be to the ultimate disadvantage of the consumer.
	Secondly, please let us not proceed on the assumption that there will inevitably be a renewal at the end of three years and an automatic extension. The proposed regulation passed by the Parliament suggests that the Commission and the Council look at the situation after 18 months and make a decision on whether further legislation is needed to extend the regime. I think and hope that the Commission will take a rational view of that, look at data on the costs of providing services and not automatically assume that the regulation should stay permanently.
	Thirdly—the noble Lord, Lord Mitchell, was one member of the committee who correctly referred to this—the proposal to which the Parliament has agreed and with which the Council seems to agree excludes any kind of regulation of data transmission. It covers simply voice transmission. Data transmission is becoming increasingly important, especially to businesses working in the European Union. We need to keep track of charges for data transmission to see whether similar action to the control over what I call the retail voice market is needed.
	Finally I make a plea for transparency. This is a plea to the industry. The tariffs which individual operators in this country make available to consumers are complicated. I am sure that quite a small percentage of your Lordships who use mobile phones are aware of the tariffs that you are offered by your UK mobile phone operator when you travel in Europe. We must have a mechanism to make sure that a wider audience is aware of what is offered. I hope that what is offered will be competitive.
	I conclude by making a brief comment on the timeliness of reports from the European Union Select Committee. The noble Lord, Lord Grenfell, who isin its place, is a distinguished chairman of the committee. I hope that he will not mind if I say that my personal view is that we must make greater efforts to ensure that our reports are concise, timely, listened to and can influence the outcome in Parliament, the European Parliament and the Council of Ministers. Here, the Department of Trade and Industry has performed extremely well with this report. We published emerging conclusions before our final report on 13 March. The Minister of State in the DTI, Mrs Margaret Hodge, replied very quickly.We produced our report on 23 April, and the Government responded very quickly. In the event, we found ourselves in almost complete agreement. Finally, the Lords parliamentary managers ensured that we had this debate today. Although Parliament took its decision yesterday, the Council's decision is yet to come. I hope that we have been timely, and that the department and our colleagues in Europe have found our modest contributions helpful.
	The noble Lord, Lord Currie, the chairman of Ofcom, has written to me to say that he could not be present today, although he would have participated. I have already paid my tributes to Ofcom. In his letter, he says, "we believe this agreement"—an agreement between the European Parliament and the Council to act, to which I have just referred—
	"marks a momentous achievement and that the interests of British industry and British consumers have been safeguarded under these negotiations and in the Regulation itself".
	We are nearing the summer holiday time. Millions of people in Europe will head for the beaches. I make a plea to the European Council of Ministers and the Commission to agree regulations to reduce international mobile phone charges, and to have them published by the end of June. That is not an impossible target. I also make a plea to the mobile phone operators not to wait for the statutory two months but to implement the recommendations enshrined in the regulations immediately. Let the young family on the beach in Torremolinos call mum and dad back home in Manchester, free from the worry over excessive costs. Let us please have action, if not this day, then this month.
	Moved, That this House takes note of the report of the European Union Committee on Mobile Phone Charges in the EU: Curbing the Excesses (17th report, HL Paper 79).—(Lord Freeman.)

Lord Mitchell: My Lords, if ever there was a timely debate, this is it, because just for once the European Commission has shown its mettle and resisted ferocious pressure. Yesterday the European Parliament voted to cap mobile phone charges. I thank the chairman of the EU Select Committee, the noble Lord, Lord Freeman, for the efficient and inclusive way in which he led this investigation. In a short time, we took evidence and produced an excellent, hard-hitting report. The noble Lord has set an example to us all.
	There are two heroes of the hour: Mr Rod Baber and Commissioner Viviane Reding. Mr Baber's name might not be known to noble Lords, but he became the first person ever to make a mobile phone call from the summit of Mount Everest. He is a hero because he had to remove his face covering and oxygen mask to make this epic call. I thank him, because at least it reminded me of the fact that the mobile phone has become ubiquitous. Very few places on Earth are out of reach, except, predictably, Hampstead, where I live and where reception is zero. When I think ofMr Baber, I also think of roaming charges. What does it take to link up a phone call from the top of Everest, via China Telecom directly to the UK? The cost per minute must have been enormous. Luckily forMr Baber, it was too cold to speak for long.
	The mobile phone industry has been a huge success. In 20 years, it has grown from almost nothing to become one of the largest industries on the planet. Once it was the preserve of well heeled business types, who carted their massive handsets around like suitcases—I know; I was one of them—and today the pocket-sized cheap mobile is everywhere, even in poor villages in Africa. For all its curses, it offers us communications that were undreamt of just a few years ago, from the City types who are virtually welded to their BlackBerries to worried parents who can now be secure in the knowledge that their children are safe. As a parent of teenage children, I confess that there is no sound more wonderful than the text bleep telling me that they have arrived at their destination. It has revolutionised our lives.
	I am going to say some fairly critical things about the mobile phone industry, which is why I have prefaced my speech by saying what a great job the industry has done. It has taken risks and invested massive amounts of money, and it deserves its rewards, or at least some of them.
	I must start with a quote from a Mr Tom Phillips of the GSM Association, a global trade association representing 700 GSM mobile phone operators in218 countries. It claims that its members represent2 billion mobile phone users, which is equivalent to80 per cent of all mobile users. Mr Phillips said:
	"Mobile phone operators price their services to a broad range of customers ... our members operate in a highly competitive market".
	That is a nice try, Mr Phillips, but you are half right and half wrong. You are right when you look at domestic tariffs. Here in the UK, for example, you can walk from shop to shop comparing what is on offer. On a contract where the charge is £30 a month you get so many minutes free of charge and so many hundreds of free SMS text messages. It is highly competitive and each operator offers special goodies to entice new customers. That is the competitive environment that gives capitalism a good name.
	However, Mr Phillips is wrong in regard to market sectors where operators relentlessly exploit sub-markets not located on the high street and where price cartel is the order of the day. Roaming within the EU has been one such cartel. Last night at the Champions League final in Athens, tens of thousands of football fans must have been calling home to Liverpool or Milan. The cost of such calls would have been as high as 85p per minute. No wonder Vodafone was the major sponsor of the event. It must have got its money back from the football fans alone.
	Why has super-pricing on roaming charges continued for so long and why has the market not encouraged competition to do what the European Union has stepped in to do this August? I think I know the answer. Until last July I was gainfully employed and my company paid my mobile phone bills. I never looked at them. Now I pay the charges myself and I am staggered by what I have seen. I would bet that most business people are just like I was—totally oblivious. Someone else picks up the tab and roaming charges become just another cost of doing business. As for the man on the street—or should I say, as the noble Lord, Lord Freeman, said, the man on the beach in France or Spain—a few pricey phone calls a year from there to here hardly warrants a major investigation. Complacency has ruled and the operators have profited from consumer inertia. It is calculated that €5.8 billion per annum is spent on inter-EU country roaming charges.
	It is true that the operators have made some half-hearted attempts to lower roaming charges. I shall pick on Vodafone for no reason except that I use it, but what I shall say could be true of any other operator. Vodafone has come up with a great wheeze called Passport. Basically, if you make a call from abroad and you are signed up to the Passport programme, you pay a 75p fixed charge per call and then you pay the standard domestic tariff. But there is an awful lot that you are not told about this programme. It does not tell you that it works only if you use a Vodafone network operator overseas. I am fairly good on technology—probably better than most—and I know how to set my phone abroad to use a specific network, but I wonder how many other people know how to do that. It also does not tell you who its operators are. In Italy, where I spend a lot of my time, I think that I can draw the conclusion that VodafoneIT is part of the Vodafone network, but who would know that it is SFR in France? However, it is a total roulette to select your operator in Italy. You can face one way one day and you get one operator: you can face the other way on another day and get another operator. In addition, you are not told that SMS texts are not included. Vodafone also fails to mention that if you are called from a landline within the EU that does not count. If you call another user in a third country, that too does not count, even if that user is on the Vodafone network.
	That has now ended, and we must thank the real heroine of the hour, Commissioner Viviane Reding. Despite heavy lobbying by the industry, which is out to protect its nice little €6 billion earner, she has persevered in getting these price caps in place. Roaming charges are about to be reduced by 70 per cent, and the commissioner did it. This summer many glasses of champagne or prosecco ought to be raised to thank her. She will be saving phone users in Europe €4.2 billion a year. I call that a real result.
	It would be wonderful if that were the end of the story, but sadly it is not. The operators still have other sub-markets where they use their oligopolistic powers to continue to rip off consumers. SMS texting is not covered by the new European arrangement, and neither is data. The text messaging business is huge and a licence to print money. I do not understand why this sector has not been capped. Then there is data. Next month there will be a revolution in mobile phones. Apple Computer is about to launch its iPhone. Apart from being a phone, it is also a multimedia device. Users will be able to download or transfer photos, movies, podcasts and music. It is like an iPod with a high-speed mobile phone connection. The demand for data is going to explode. Imagine the very same European citizens on the beaches in Europe next year, this time sending multimedia data across the continent on their iPhones. Data pricing is uncapped and the operators are going to have a field day.
	This debate centres on the EU, but outside it are huge markets which are further cartel sub-markets for the operators. Many of our citizens go to the United States for their holidays or for business. Roaming charges from America are astronomical, as they are from Asia, Russia and Australia. I would like to see moves to cap these sector prices as well.
	The thrust of the industry criticism is that the natural forces of competition should rule pricing policy and that the EU should stay out. Well, they are bound to say that. Last Tuesday, there was a withering editorial in the Wall Street Journal accusing Ms Reding of being a "Soviet era central planner". What utter nonsense. I am not a politician, I am an entrepreneur by background. In my bones I understand full well the balance between risk and reward. I might have been expected to be sympathetic to the operators, but I absolutely am not. When consumers are the victims of monopoly power and when producers conspire to maintain artificial prices, the moment comes for such power to be contained. That is what the EU has done. It has taken the first step and it deserves all our thanks.

Lord Dykes: My Lords, the noble Lord, Lord Mitchell, says that he is a capitalist and entrepreneur. We pay tribute to his work in those fields over many years, but for him to say what he has just said really spells it out: one has to have regulation when there is clear abuse of the market whereby customers have no chance of making proper calculations about real prices. We thank him for what he has said. Above all, I want to add my congratulations to the noble Lord, Lord Freeman, on the truly outstanding way in which he has husbanded this important investigation through our committee proceedings. There was a danger that we would miss the momentous developments in this saga, understandably and through no one's fault, and yet we did not and I am grateful to him and to our Clerk, officials and advisers for what was done to make sure that we were kept up to speed on this extremely complicated matter for those who are not experts in mobile phones, particularly in their use when overseas.
	Our celerity was especially noticeable in the expeditious treatment of a very rapidly unfolding scene once the mobile phone companies realised that the old game of excessive charging in an imperfectly informed marketplace was finished, or at least beginning to be finished. It was necessary for Sub-Committee B to move very fast indeed on this one. Everyone co-operated and the Government also acted rapidly—I thank the noble Lord, Lord Truscott, and Mrs Margaret Hodge for what they have done—to keep some control of the situation, bearing in mind that it is an international and very complex matter. The speed and decisiveness of our chairman and the members of the committee were especially needed as co-ordination between them and the members of the Government and officials at Ofcom dealing with the inquiry was going to be overtaken by the hugely energetic work of the German presidency, Commissioner Reding and Members of the European Parliament who are particularly expert on this subject.
	It was gratifying to see in the opening stages of this exercise that even hints of future action by the European Commission had the industry responding with charmingly hasty cuts in some roaming and related charges, once again showing how super-normal the profit-making already had been for far too long. This is yet another example of where the Commission's energetic battling to secure genuinely open and transparent single market conditions in many different fields is gradually bearing fruit. It is a slow and painful process, and one where often the national press in different countries, particularly in this country, writes articles resisting the process. The resistance and the cartel antics of the companies in many sectors have to be fought very hard indeed, particularly in this sector.
	I sense the same mistakes are made by often understandably ignorant consumers—not through their own fault but through the nature of the market and the complexities of all kinds of services—in blindly accepting monopolistic, imperfect overcharging markets in areas such as bank charges and credit charges. How many holidaymakers calculate the costs—particularly if they are paying their credit card over a month, which is always very unwise—when they change from sterling into the euro? The cost would shake them if they sat down and did the figures, but it is amazing how few people do so. This happens with mortgage charges, too, particularly in this country which is not a member of the eurozone. Mortgages here are much more expensive than they are in the leading countries of the eurozone.
	It remains sadly true that if customers really took the meticulous trouble to work out precisely how much they are paying in some of these market places, they would be truly outraged. All too often they have only a vague idea or they shrug their shoulders and say, "Well, it is an overseas market". But it is supposed to be the developing single European market, not an overseas market in the conventional sense.
	Not all consumers of roaming services, however, were so supine. In the evidence we accumulated in February, representatives from companies such as Hutchinson, for example, admitted that they, the public,
	"coming back from holidays are often horrified at ... the charges that have been made".
	It has always been the case that business users might pay more attention to these excess costs if they were roaming frequently abroad. Most roaming is done by business users, particularly by small and medium-sized companies, but in reality that could be offset—it sounds cynical, I know—if the costs were being borne not by the person personally but by the company's treasurer's department. For private consumers the situation is much starker.
	Naturally, we in the committee were primarily concerned with the plight of private self-paying users. Although they remain a minority, the figure goes up when the summer holiday comes along throughout Europe, mainly in Mediterranean areas. In the mean time, retail roaming prices had begun to come down a little in recent years as competition began to exert more effect and other parts of the packages offset, to some degree, the heavy incidence of the roaming net cost to customers.
	Some of us were surprised—the noble Lord, Lord Mitchell, alluded to some of the comments made by the companies—that Orange, part of the worldwide France Telecom group, felt that no regulation of wholesale or retail charges was needed at all; that everything could be done by competition. It also felt strongly that Article 95 of the Treaty of Rome was inappropriate as a way to impose regulation of maximum charges. I would love to hear from any noble Lord who has experience of trying to cancel a mobile phone contract. It is an exceedingly difficult process and takes a long time. You have to insist or threaten with lawyers before you get out of it.
	Market 17, the one for international roaming charges, was already being scrutinised under the new regulatory framework procedure, of course, but I feel strongly that the Commissioner was fully justified in seizing the reins quickly and accelerating the inquiry processes by the subsequent decision on what was effectively severe market abuse and excessive market cartelisation, notwithstanding Vodafone's repeated claims that it had launched more competitive roaming rates as far back as 2001, described eloquently by the noble Lord, Lord Mitchell.
	The distinguished MEP, Dr Paul Rubig from Austria, reminded the committee in his testimony that it was bad enough facing excessive charges and profiteering in the UK, but at least it was across the water. Psychologically it seemed a little more remote and perhaps was understandable as the wires were a long way away—not that they have wires. He asked about considering the question of the psychological stress on our continental neighbours. He cited in his testimony a five cents charge for domestic calls through 1,000 kilometres of his own country, but someone on the border of Austria with Germany calling a nearby German neighbour would pay up to €2 because it was over a national frontier.
	Moreover, the charges were always so vague and complicated to calculate, with rebates on accounts afterwards to make it even more obscure. As he stated, it was like being in a restaurant where the waiter would give you the wine and work out the price afterwards.
	The committee also benefited from the written evidence given by the Bureau Européen des Unions de Consommateurs, reminding us starkly that the Commission had started action way back in 2000, but that this had not stopped the rise in unfair roaming charges and that the national regulatory agencies—even the excellent Ofcom in Britain—could not solve these problems across national frontiers. Only the Commission, once again showing the validity of its work in the single market, had that intrinsic capacity. That will be shown in many other fields in future, as the public in different member states begin to accept this, even in Britain.
	The British Minister in charge, Mrs Hodge, assured us that the UK Government were going all out to support the EU-wide solution because of self-evident market failure, as I said earlier. I therefore enthusiastically support the committee's recommendations, and am glad to have been involved in an inquiry that will be of great help to mobile phone customers in years to come. However, to be fair to the companies, we also proposed a sunset clause, and some kind of review is necessary to see the changes in the marketplace over time.
	I welcome our references to the crucial field of data roaming services—I imagine they will outstrip individual calls in due course, as my noble friendLord Mitchell has suggested. Our conclusions also underscored the reality that high roaming prices were adversely affecting SME personnel trying to do legitimate business in what is supposed to be a single market.
	If wholesale regulation is the right approach, however, the consumer protection tariff, or the EU tariff, is the way forward. We understand why the MEPs have reached that decision, which will be finalised on 7 June. We have thus almost reached, last week and this week, the end stage of a complicated scene, with the agreement between the member states and the EP to fix the maximums and the caps. I believe the Council telecom Ministers will now be fully engaged in discussing properly and accepting—not just rubber-stamping by the member states—the European Parliament debate suggestions.
	This has been a very good example of strong work co-ordination between the national parliaments, national Governments, the European Parliament and the member states. Some people regard that as an international conspiracy. I think it is a very good thing.

Lord Lee of Trafford: My Lords, as one whohas supported the concept of closer European co-operation over 40 years, originally being a member of the Manchester Common Market Group and more recently being chairman of the Northwest in Europe campaign, I am delighted to participate in today's debate.
	The report discussed here today is on draft regulation, which is important because of what it represents. It is not just legislation that will help to reduce the excessive prices European consumers are charged when using their mobile phones abroad; it is a good example of how legislation on the EU level can actually make a difference to the everyday life of the citizens of EU member states. The cost of roaming could not be dealt with individually by member states. The cross-border nature of this service made it impossible for national regulators to act. Action on the EU level was required, and the Commission's proposals, as amended by the European Parliament, the member states and the Council of Ministers, aim to do just that. They offer a solution at European level that will benefit every traveller who uses his or her mobile phone when abroad in another EU member state. All in all, it was a well received report that contributed to the debate and fed in important recommendations to the decision-making process in Brussels.
	I join my colleagues from the committee, my noble friend Lord Dykes and the noble Lord, Lord Mitchell, in paying tribute to our chairman, the noble Lord, Lord Freeman, and to our colleagues. We had a very happy committee under the noble Lord's chairmanship. I also pay tribute to our committee staff.
	The agreement announced this week should reduce roaming charge bills by between 50 per cent and70 per cent. In the Financial Times today, Nigel Farage, the leader of UKIP and a British MEP, is quoted as saying that in his view the law is a publicity stunt:
	"Frankly, it smacks of communist central planning when bureaucrats and politicians think they know what the right market price is. They are always wrong".
	I am a little disappointed that the noble Lord, Lord Pearson of Rannoch, is not in his place. If he were, no doubt he would be attacking the agreement which so demonstrably benefits so many of us who travel overseas or go there on business.
	There is a suggestion in the media and a number of other quarters that perhaps mobile phone companies will seek to replace lost revenue and profits by raising charges in their national markets. The national Governments in the EEC have various differing regulatory powers in individual member states and monitor in different ways. In the UK we have, thankfully, a free market. I hope that genuine competition will keep prices down and that consumers who are accustomed to a certain price level for mobile use will be on their guard against artificial price rises. The UK regulatory authority, Ofcom, will need to be extra vigilant in policing our market.
	In conclusion, I commend our report and welcome the European agreement with the caveats so clearly set out by our chairman, the noble Lord, Lord Freeman.

Lord Truscott: My Lords, this has been a very useful, constructive and informative debate. If only the whole issue had been treated in this thoughtful way, we might well have ended up with better regulation earlier.
	I thank the noble Lord, Lord Freeman, other members of the European Union Committee and the internal market sub-committee in particular for their work on this thorough and considered report before your Lordships' House. I am pleased to say that the Government agree with virtually all the report's conclusions and that the committee's views have provided a welcome and valuable insight into this topic, which has been the subject of protracted and complex negotiations during the past year. I thank the noble Lord, Lord Dykes, for his kind words on the work done by Her Majesty's Government in this area.
	The noble Lord, Lord Dykes, mentioned concerns about transparency. I certainly agree that it is important that people know the costs of their calls when they travel and the regulation ensures that such prices are delivered by SMS as soon as a foreign country is entered.
	A wide range of points and questions has been raised today, but before addressing them individually, it might be useful if I outlined where we now are in the process. As the noble Lord, Lord Freeman, said—I thank him for his elucidation of this matter, which I am sure has helped all noble Lords—the regulation is almost taking final shape.
	As my noble friend Lord Mitchell and the noble Lord, Lord Freeman, mentioned, the European Parliament yesterday concluded its first reading of the relevant dossier. The text will be presented for endorsement by Ministers at the Telecoms Council on 7 June. Unless the council took a radically different approach from that previously taken during the discussions last week, the regulation will be agreed. Indeed, if there was not an agreement, the regulation would have to be sent back to the Parliament for a Second Reading, so we would not be seeing cheaper roaming calls until next Easter at the earliest. Obviously, we want to avoid that.
	So-called first reading agreements are not that common and involve an enormous commitment between the institutions to find a compromise. This dossier was certainly no exception in that regard; and involved no fewer than four long and detailed negotiations between the council, represented by the presidency, the Commission and representatives of the European Parliament. The fact that an agreement was reached says a lot about the skills of the German presidency. I take this opportunity to thank ministerial colleagues in France, Italy and Spain who worked tirelessly with my right honourable friend Margaret Hodge to secure a solution that did not damage the competitiveness of this important sector for Europe.
	The European Union has agreed at this stage that the Euro tariff will be the same as a safety net, as noble Lords themselves wanted in their report. That allows for innovation, as other tariffs can be offered. A variety of figures have been quoted in the press purporting to be the new mobile roaming prices. It may be worth restating them at this point. The Euro tariff will be available to all roaming customers. Under it, outbound calls made to other member states under the tariff will be charged at 49 eurocents—that is, 33.5p per minute. Calls received from other member states will be charged at 24 eurocents, or 16.5p per minute. Those rates will fall in the next two years of the regulations to 31.5 and 15p in year 2 and 29.5 and 13p in year 3.
	All users will not automatically be transferred on to the Euro tariff. Those already on more favourable tariffs, perhaps by virtue of using bundle services, will be offered the Euro tariff but will not be obliged to take it and will not be put on it unless they ask. That is an important point of principle for the UK. The new roaming customer or one who moves to another network can be offered a variety of tariffs but will be put on the Euro tariff if a choice is not made. When moving from one network to another, users will be entitled to receive information about the new tariffs that they will be charged.
	At the wholesale level, prices will be capped at30 eurocents per minute, equating to 20.5p for the first year, which will drop to 19p in year 2 and 17.5p in year 3. These rates, which we believe are an adequate reflection of costs, should not, despite what one reads in the media, cause increased prices in the domestic market. On the other hand, the initial proposals made by the Commission would have had this effect.
	As for the introduction of price caps, I am pleased to confirm that the wholesale cap will be introduced two months after the regulation is published, which will probably be in September, with the Euro tariff taking effect a month later. That will mean that by October all subscribers should have the choice of adopting the new tariff.
	The regulation contains a sunset clause, as the noble Lord, Lord Dykes, said, which means that unless its continued existence proves necessary the regulation will cease to operate after three years. The noble Lord, Lord Freeman, also mentioned this. The need for an extension of the lifespan of the regulation will be determined by means of a review, which will be carried out after the regulation has been in force for18 months. It is not automatic and any extension over the three years must be voted on again by the European Parliament and Council. I believe that that answers the noble Lord's point on that matter.
	The regulation has attracted a great deal of interest, for obvious reasons. Mobile phones have become an integral part of many people's lives and working practices, as my noble friend Lord Mitchell graphically illustrated to your Lordships' House. Nobody enjoys paying high prices for something they have come to regard as a necessity. There was general agreement from the very start that the objectivesof this regulation were good. As a well-known advertising slogan said, "It's good to talk"—but not at £1, or more, per minute.
	As noble Lords said, lower prices for international mobile phone calls make sense. Clear information about charges for roaming calls also makes sense. Lower wholesale prices between mobile operators are also to be welcomed. The main objective of this regulation is to encourage business people and leisure travellers to use their phones in the knowledge that they will not face a hefty phone bill later. It is also intended to encourage smaller mobile operators to enter the market. Competition drives innovation and gives rise to a better deal for the consumer.
	The noble Lord, Lord Lee of Trafford, referred to charges being raised in national markets. We do not think that will happen. We agree that competition should prevent that happening. We have taken action to ensure that rates are not set below operators' costs.
	There have been many calls—if noble Lords will forgive the pun—on mobile operators to lower prices, especially from the European Commission, but up until now they have been to no avail. Furthermore, the national telecoms regulators across Europe stated through the European Regulators Group—the noble Lord, Lord Lee of Trafford, made this point—that they were unable to take effective action individually and had asked the European Commission to intervene. I agree with the noble Lord that the role of the regulators should be enhanced and that they should remain vigilant. I support his call for vigilance on the part of the regulators. Finally, in July last year, the Commission, with a fanfare, issued a draft regulation which aimed to address this problem. Like other noble Lords, I commend Commissioner Viviane Reding for her heroic efforts in this sphere.
	We believe that we have now agreed a good and pragmatic solution which will deliver the desired results. Importantly, in relation to this debate, it is almost entirely consistent with the form of regulation called for by the committee. It balances the objectives of lower prices, innovation in the marketplace and sustained competition. It ensures that subscribers are not forced on to tariffs that might be less favourable to them and secures enhanced levels of transparency for all citizens using their phones abroad. It has a "sunset" clause limiting the life of the regulation to three years, unless it is decided that an extension is needed.
	Importantly, the regulation—after some debate in the European Parliament—applies only to voice calls; the price of text messages and data downloads are not controlled. A number of noble Lords made that point, including the noble Lord, Lord Freeman, my noble friend Lord Mitchell and the noble Baroness, Lady Wilcox. However, it contains a provision that the price of such services should be made available to subscribers when they are roaming and that information about these should be collected by the national regulatory authorities. If these prices remain at an unacceptably high level, they may also be regulated in the future. Clearly, it would be preferable if this did not prove to be necessary, but the Commission has already said that it will monitor the situation, and Commissioner Viviane Reding has been reported as confirming that. The Commission will also review data and SMS costs in its report after 18 months.
	As I have noted, the UK has worked closely with other member states to put forward constructive suggestions throughout these negotiations. The noble Baroness, Lady Wilcox, referred to sufficiency of data for formulating the regulation. The data used to derive the wholesale price cap levels were based primarily on detailed cost calculations and analysis undertaken by national regulatory authorities and were consulted on with mobile operators in order to set mobile termination rates. We believe that these are a reasonable proxy for the most costly parts of providing international roaming services. Further analysis and data will always improve the accuracy of any measure. However, the need for further detailed analysis should be weighed against any resulting benefit. At this stage we believe that the additional burden incurred by a delay in implementing the regulation would outweigh any benefit gained by a more accurate understanding of underlying costs.
	As regards the cap on mobile phone charges, I should point out that the Euro tariff is not a cap but a tariff with regulated rates available to all. Our aim has always been to ensure that the proposed regulation would deliver a better deal for the consumer without unnecessary damage to the telecommunications industry. I suggest that, in the light of the regulation agreed by the European Parliament yesterday and our debate this afternoon, that has been achieved.
	In conclusion, I thank all noble Lords who have taken part in the debate, and I commend the committee on its excellent work.